As more and more holidays and travel arrangements are paid for using credit cards it has become popular knowledge that by paying this way you are effectively building up an insurance policy against your losing out if things go wrong.
Whilst an ever increasing number of people seek to get the most for their money and often go for cheaper deals, there is an increasing propensity for things to go wrong and complaints arise more often. Also, with the compensation culture on the rise, individuals are not as shy as they were in the past to make sure they get good service and what they actually paid for, again resulting in even more complaints.
If an airline or holiday company becomes insolvent and you were to have your holiday cancelled then the trade bodies like ABTA do provide a level of protection, but under the various terms of The Consumer Credit Act 1974 it is possible to claim against your credit card company. Thus they can act as a safety net for consumer protection. There has been a huge escalation in bank charge complaints and it is virtually impossible now for a travel company to get merchant facilities because of the high risk associated with charge-backs. Although in the UK the companies have a right of appeal, consumers have a strong case to claim back their funds for almost any reason for dissatisfaction.
Clearly, in the case of a company going bankrupt this is very good protection but in many cases the old maxim of 'getting what you pay for' should perhaps apply. Although there may not be much sympathy for the banks, they are in some cases losing out, possibly unjustifiably with an increasing number of unscrupulous customers to match the unscrupulous traders.