U.S.-based financial services company Mastercard is putting an end to automatic free trial billing.
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, services that offer free trials will need to gain cardholder approval at the end of a trial period in order to start the billing process.
“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,” reads an excerpt from the same January 16th media release.
“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.”
Mastercard cardholder statements will also include merchant website URLs or store phone numbers where purchases were made.
Source: Mastercard
Update 17/01/2019: Mastercard clarified that it wouldn’t be able to block auto-renewing free-trials for digital purchases like Spotify or Dropbox. Instead, it’s clarified that the new policy only applies to physical products that are delivered to your door. These are free-trials for things like vitamins or food.
While this seems odd considering how many digital free-trials are out there, Mastercard told The Verge that it wanted to start with home delivery free-trial products because that’s where its customers have been having the most issues.
Mastercard has updated its blog post from January 16th to reflect the true intentions of its feature.
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