Presuppose that a Card Holder charged or debited her credit card, to pay deposit money to a Merchant company for a good. But then Merchant bankrupts, before Card Holder ever obtains the good. Merchant has not refunded — and refuses to refund — Card Holder.

Do NOT discuss suing Merchant here. Presuppose the Card Holder can NOT recoup her deposit by suing Merchant. E.g. Merchant has no money to pay all its creditors, Card Holder is at the back of the queue of creditors, or Merchant's secured creditors are prioritized over Card holder's unsecured deposit.

My 2 questions

  1. Is Issuing Bank unqualifiedly — and legally — obligated to refund Card Holder the whole amount of the deposit?

  2. Or does Card Holder's success depend on the Issuing Bank's ability to get refunded by the (Merchant's) Acquiring Bank?

I herewith authorize anyone to edit this post, if I misused the terminology. Top pic from Medium. Bottom pic source.

1 Answer 1


There is no general legal responsibility for the bank.
Any result is independent of the merchant's cooperation.
So the answers are No, and No.

Most credit card contracts have sections that do offer you such a protection, if the situation is within defined parameters.
Typically, you need to ask for a refund within 60 days of the billing date where the charge shows up (not 60 days after payment, so you get some extra time), and the total is often limited per case (5000 $ or so) and per year (varying limits).
You may be required to fill their respective form(s), and support them in recovering the cost by answering questions and / or forwarding documentation they ask for. The cooperation (or lack of such) of the merchant is not your problem.

You will need to check your specific credit card contract for your details

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