Mastercard is putting an end to automatic billing after the end of free trials

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The world is awash with subscription services – letting users watch as much as they like, read to their hearts’ content or listen to more music than their ears can rightly handle. It’s become ridiculously easy to tap into a world of media for a set monthly fee. Most of those services even offer limited free trials, allowing you to dip your toes without any sort of long-term financial commitment. Most free trials do still require credit card details, and tend to automatically start a recurring subscription once the trial concludes.

If you’ve ever forgotten to cancel a trial, you’ll know this can end up gobbling money you hadn’t banked on losing. Mastercard wants to stop that. Mastercard will now mandate that its customers get notified at the end of a free trial, and that they have to opt-in to a recurring subscription.

“The rule change will require merchants to gain cardholder approval at the conclusion of the trial before they start billing. To help cardholders with that decision, merchants will be required to send the cardholder – either by email or text – the transaction amount, payment date, merchant name along with explicit instructions on how to cancel a trial.”

On top of that, merchants will have to send an invoice by text or mail for every single transaction thereafter, for those subscriptions you may have forgotten you were even paying. That invoice will also have to include very clear instructions on how to cancel said subscription. Card statements will also have to include contact information for merchants, either a website URL or the phone number of the store or service.

“Free trial offers can be a legitimate and useful way to increase sales and improve consumer satisfaction. The new rules will help in increase transparency and ensure an outstanding experience for cardholders. In addition to these changes, Mastercard cardholders are also covered by our Zero Liability policy which protects them against unauthorized purchases or charges. If a cardholder suspects that a transaction is fraudulent or unusual, we encourage them to contact the bank that issues their card for assistance and more information.”

It’s a nice consumer-centric move that should help put an end to some of the more predatory recurrent subscription services.

Last Updated: January 17, 2019

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