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How may the law protect me when I buy or finance items online?

You most likely appreciate the systems that allow you to select and pay for items quickly online. If you visit a website and use your credit card, the Fair Credit Billing Act protects you even when you make purchases from merchants located outside of Maryland.

Under the FCBA, consumers have protection against paying for errors or mistakes found on their billing statements. You may file a dispute with the financial institution issuing your card within 60 days of when you receive your statement.

What does a card issuer do when you report an error?

As noted on the Federal Trade Commission’s website, when you notify your card’s issuer of a billing error, the company must perform an investigation. Errors in billing could include incorrect charges and computational mistakes.

Verifying an incorrect charge typically results in a reversal to your account. The FBCA requires card issuers to resolve disputes and provide consumers with an explanation of its investigation results by mail.

What protections may I have with a “buy now, pay later” loan?

As reported by CNBC, when using an online point-of-sale system known as a “buy now, pay later” loan, you may not receive the same protections generally offered with credit card purchases. Because the FBCA only covers open-ended credit and retail cards, BNPL loans do not follow the same regulations.

Maryland’s residents, however, have protections under Maryland Commercial Law Title 12. BNPL providers may charge no more than 6% interest each year on unpaid balances. A BNPL provider registered as a licensed collection agency must also follow Maryland’s Fair Debt Collection Practices Act, which forbids collecting payments through deceptive or threatening actions.

Although websites allow for fast and easy shopping, you may find errors or unauthorized charges on your statements. You have a right to report and dispute them until a financial institution resolves your issue.