An Easy Way to Avoid Being Charged for an Auto-Renewal

Many of us have done it: We sign up for a free trial or other service and tell ourselves we won’t forget to cancel before being charged an auto-renewal fee.

Alas, we inevitably forget and end up saddled with a charge we never intended to incur.

Now, your credit card likely promises some protection.

The Points Guy reports that the three biggest players in the credit card space — Visa, Mastercard and American Express — make it easier to avoid these charges. Here is how each card’s policy works.

Visa

Visa’s terms dictate that when you sign up for a free trial with a subscription service, the provider must email or text you with the following details:

• “Immediate confirmation of the terms of the agreement
• Proactive notification of any future payments at the end of the trial period
• Instructions on how to initiate a cancellation”

American Express

An AmEx spokesperson told The Points Guy that service providers must get your approval before billing you. Contact information must be clear, and the provider is required to act promptly to cancel your account, the spokesperson says.

The Points Guy notes that unlike Visa, AmEx does not require the provider to email or text you shortly before a free trial ends, however.

Mastercard

Mastercard offers protection, too. But it’s somewhat more limited.

In fact, the Mastercard policy — which requires merchants to notify you before billing begins — applies only to physical products like skin care and health care items, not streaming and other digital services, The Points Guy reports.

As part of the policy, the merchant must email or text the notification, and provide cancellation instructions.

How to reverse the charge

What happens if the service provider violates these terms? The Points Guy notes that getting a charge reversed can be a bit complicated:

“With that said, none of the card networks will know at the time of charge whether the proper notification was made or not. Most likely, it would require a dispute. If there are enough complaints, that could be a violation of the merchant’s contract — and perhaps the card company could go to the extreme step of refusing to accept charges.”

Another option is to use a service like Trim or Truebill. We detail how Trim works in “This Tool Makes It Easy to Slash Bills and Build Savings.”

Or, you might want to look for a better credit card. Stop by Money Talks News’ Solutions Center to search for the right credit card for you.