Idea 2 of 11 · working draft
Make It as Easy to Cancel a Recurring Charge as It Was to Sign Up
You could cancel the same way you signed up, and choose each year which companies may keep charging you.
If you cancel a subscription, the charges should stop. Today, debit card users have a legal right to stop certain automatic payments, but credit card users do not. This plan gives credit card users a stop-payment right that banks must honor. It also asks you to re-approve a company once a year, and it stops card networks from passing your new card number to a company you cancelled.
What it would do
- Give credit card users a clear right to stop repeat charges.
- Require card companies and payment networks to honor that request.
- Ask you to approve each company again once a year.
- Require your permission before sharing a new card number with a company.
The gap today
Debit card users have a federal right to stop certain automatic payments. Credit card users do not. Also, some card-update services pass a new card number to a company even after you cancel the old card.
How it would work
- Define a clear category for subscriptions and charges that renew unless you cancel.
- You approve a company once. That approval ends after one year unless you renew it.
- A stop-payment request to your card company is binding on the card company and the payment network.
- Card updater services must get your permission for each company before sharing a new card number.
Enforcement without a new agency
Companies would label what they sell. The banks that process their payments would check those labels. Card issuers would have to honor stop-payment requests. State attorneys general and consumers could take action over repeated violations.
The tradeoff
Stronger consent adds some friction. The yearly approval is the compromise. It is often enough to catch forgotten charges, but it does not interrupt a service you want every month.
Sources and background
The CFPB describes stop-payment protections for automatic debit payments from a bank account. This is background for the gap the draft addresses, not a source showing that the proposed credit-card rules or annual renewal requirement already exist.
Estimate what this could mean for your recurring charges
Estimate only — your actual savings may differ.
Enter your own amount and the reduction you want to test. Nothing is filled in for you.
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- The amount you entered is your real bill or charge.
- The reduction percent is your own guess, not a number from us.
- Monthly amounts are multiplied by 12 to get a yearly figure.
- It does not guarantee what any policy would do. Your numbers stay in your browser and are not saved or sent.
Common questions
- What is the “Make It as Easy to Cancel a Recurring Charge as It Was to Sign Up” idea?
- You could cancel the same way you signed up, and choose each year which companies may keep charging you.
- How would it work?
- If you cancel a subscription, the charges should stop. Today, debit card users have a legal right to stop certain automatic payments, but credit card users do not. This plan gives credit card users a stop-payment right that banks must honor. It also asks you to re-approve a company once a year, and it stops card networks from passing your new card number to a company you cancelled.
- The gap today?
- Debit card users have a federal right to stop certain automatic payments. Credit card users do not. Also, some card-update services pass a new card number to a company even after you cancel the old card.
- How it would work?
- Define a clear category for subscriptions and charges that renew unless you cancel. You approve a company once. That approval ends after one year unless you renew it. A stop-payment request to your card company is binding on the card company and the payment network. Card updater services must get your permission for each company before sharing a new card number.
- Enforcement without a new agency?
- Companies would label what they sell. The banks that process their payments would check those labels. Card issuers would have to honor stop-payment requests. State attorneys general and consumers could take action over repeated violations.
- The tradeoff?
- Stronger consent adds some friction. The yearly approval is the compromise. It is often enough to catch forgotten charges, but it does not interrupt a service you want every month.
- Sources and background?
- The CFPB describes stop-payment protections for automatic debit payments from a bank account. This is background for the gap the draft addresses, not a source showing that the proposed credit-card rules or annual renewal requirement already exist.
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