Argos to refund more than £500,000 to 114,000 customers after breaking extended warranty rules

ARGOS will refund over £500,000 in total to 114,000 customers after breaking extended warranty rules.

For more than a year, the high street giant failed to remind customers to shop around for an extended warranty deal, according to the competitions watchdog.

Argos will have to dish out half a million pounds to thousands of customersCredit: Getty

Affected customers will get the refunds paid in e-card vouchers to spend in store, according to the Competition & Markets Authority (CMA).

The retailer owes a total of £570,010 to customers, which means on average, each customer will get a fiver.

However, as this is an average figure it could vary – which means that you may get more, or less.

Argos has yet to confirm whether the e-card vouchers can be spent both in store and online and whether they have an expiry date.

What is an extended warranty?

WARRANTIES offer you protection if something goes wrong with a new purchase and are different to guarantees – but you might not need to buy one at all.

Product guarantees are usually provided for free by a retailer, whereas a warranty is often paid for and lasts longer than a guarantee.

There are both standard and extended warranties, with the latter being an additional protection on top of the standard agreement.

But you don’t legally have to buy a warranty at all, and you still have statutory rights in other ways due to the Consumer Rights Act 2015.

Which? explains this may include a refund, repair or replacement, if you find your product is faulty within the first six months of owning it.

If a fault develops after the first six months, the burden is on you to prove that the product was faulty at the time the goods were delivered to you.

Customers have up to six years to make a claim for an item they’ve bought, or five years in Scotland.

If you have home contents insurance, your product may also be covered through this – but read the small print of your policy carefully.

Before you think about paying for an extended warranty, remember that manufacturers also often guarantee their goods for up to 12 months.

Check the terms and conditions of your purchase carefully.

If you do decide to buy an extended warranty, make sure you shop around for the cheapest deal.

Money Advice Service suggests using Compare Extended Warranties for domestic electrical goods.

We’ve asked Argos how much each customer will get and how they can spend their gift cards, and we will update the story when we know more.

Extended warranties offer people the chance to pay for more protection when buying products, over and above any standard guarantee.

In 2012, Argos signed a legal agreement promising to provide a link to a price comparison website every time it offers an extended warranty for domestic electrical products online.

This is so that customers can compare the price of the warranty elsewhere, and potentially get a better deal.

But the CMA found that the retailer was not displaying this link – and Argos admitted it hadn’t been for more than a year.

In total, over 400,000 extended warranties were sold without a link, meaning around 114,000 customers may have been able to save cash by shopping elsewhere.

Argos will now contact all affected customers, who will also have the option to cancel their extended warranty for free.

The retailer is yet to confirm when shoppers can expect to hear from them.

Argos has now promised to include a link to a price comparison site when selling extended warranties from now on and would carry out regular checks to avoid a breach happening again.

The CMA said it will consider “formal enforcement action” if Argos is caught breaching the rules again.

The regulator has also advised shoppers to get in touch with Argos if they believe they have been incorrectly sold an extended warranty.

Adam Land, CMA senior director of remedies business and financial analysis, said: “It’s only right that Argos is now taking steps to fix its error and make sure that something similar doesn’t happen in the future.”