U.S.-based financial services company Mastercard is changing its rules for merchants using free trials as a ruse to charge for hard-to-cancel recurring subscriptions.
As of April 2019, customers who use a Mastercard debit or credit card to sign up for a free trial won’t be billed once their trial period is over. According to a January 16th, 2019 media release, 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. For each payment thereafter, the merchant will have to send a receipt to the cardholder for each transaction by email or text message with clear instructions on how to cancel the service if the consumer so desires.
In addition, all charges that appear on the cardholder’s statement must now include the merchant website URL or the phone number of the store where the cardholder made the purchase.
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