NEW YORK (AP) — A “click-to-cancel” rule, which would have made it easier for U.S. consumers to end unwanted subscriptions, has been blocked by a federal appeals court days before it was set to take effect. However, there are ways to cancel those subscriptions and memberships, even if you have to work a bit to accomplish it.
The rule would have required companies to tell customers when free trials and promotional offers would end, and to allow customers to cancel recurring subscriptions as easily as they started them. But even without the new federal directive, here are some ways to cancel subscriptions and membership dues.
Use calendar reminders and review your bills regularly.
Experts from the Consumer Federation of America — a coalition of nonprofit organizations focused on defending consumers — recommend setting calendar reminders for when a free trial ends, to remind you to cancel promotional offers before real recurring charges begin. The auto-signup process, in which the company does not email the consumer that a trial is about to end and higher monthly charges will begin, was also at the core of the FTC rule.
“No subscription business model should be structured to benefit from an obstacle-course cancellation process,” said Erin Witte, Director of Consumer Protection at the Consumer Federation of America, in a statement about the rule regarding click-to-cancel.
Regularly reviewing your credit and debit card statements can also help you track any recurring charges, including price increases you may have overlooked or did not anticipate when trying out a new subscription or membership.
Know the terms and conditions of your subscription
“Companies make it easy for consumers to click to enroll and easy for companies to pull funds automatically from consumers’ accounts,” said Shennan Kavanagh, Director of Litigation at the National Consumer Law Center (NCLC) — a nonprofit defending low-income consumers — in a statement about the FTC’s click-to-cancel rule. “People shouldn’t have to spend months trying to cancel unwanted subscriptions.”
However, given the FTC’s canceled rule, companies could still legally require customers to cancel memberships or subscriptions by phone, even when they allow online sign-up, enrollment, and bill payment. Consumer advocates say this imposes an extra burden of time and effort on the consumer to stop an unwanted recurring charge, but sometimes knowing the terms of the subscription and making a phone call is worth it.
There are some services that cancel subscriptions for you
Apps like Rocket Money and services like Trim, which you access via a browser, can track your recurring monthly fees and subscriptions, either free of charge or for a fee, and can help you spot new ones or even cancel some.
For parents in particular, a service like Trim could help them know when a child has started a new subscription, game, or membership before the fees become recurring. And Rocket Money will actively work to end unwanted subscriptions for you, for a monthly fee. If the company cannot end or successfully cancel the subscription or membership, it will provide the customer with the information needed to do so. Trim also offers this service, in its premium form, for an additional fee.
Stand up to offers when canceling
The FTC is currently moving forward with preparations for a lawsuit related to Amazon’s Prime program, which accuses the retailer of enrolling consumers in its Prime program without their consent and making it harder to cancel subscriptions.
Often, when a consumer tries to cancel a subscription to something like Prime, which offers free shipping and streaming video, the company will offer another month or more of the subscription at a promotional rate, at half price, or other incentives that seem better, in order to tempt the customer to stay. Standing firm against what might seem like a good offer can help you stop the recurring monthly charges before you forget to cancel again.
Accepting another trial period or promotional rate, which is another route to auto-enrollment, only perpetuates the cycle, according to consumer advocates.
What would the FTC rule have done?
The FTC rule would have required companies to obtain customer consent before charging for memberships, automatic renewals, and programs tied to free-trial periods. Companies would also have had to disclose when free trials and promotional offers would end.
The United States Court of Appeals for the Eighth Circuit recently indicated that the FTC erred procedurally by not conducting a regulatory impact analysis, which is required for rules whose annual impact on the U.S. economy exceeds $100 million.
The FTC said it did not need to conduct a regulatory impact analysis because it initially determined that the rule’s impact on the national economy would be below $100 million. An administrative-law judge later determined that the economic impact would exceed the $100 million threshold, and the court struck down the rule.
The Biden administration had included the FTC proposal as part of its “Time is Money” initiative, which aimed to tackle consumer inconveniences.
