Subscriptions are easy to sign up for, but cancelling them is difficult.
According to an FTC statement, a provision was proposed by the Federal Trade Commission on Thursday. It aims to address “seemingly never ending struggles to cancel unwanted subscription payments plans.”
The FTC’s “click-to-cancel” provision would require sellers to make cancellations of subscriptions as easy and straightforward as signing up for them. If a gym allows you sign up online for a membership, it must also allow you to cancel that membership online in the same number steps.
This is a preliminary provision. The FTC published the proposed rule on its Federal Register Notices. People are encouraged to make comments about the proposal. The FTC must receive those comments within 60 days of the publication date on March 23rd. The FTC has not yet responded to a request for comments.
This provision would be a boon to many Americans. C+R Research in Chicago found that 74% of respondents thought it was easy to forget about monthly subscription fees. 42% stated they still pay for subscriptions they don’t use. This survey was part of 1,000 U.S. self-reporting surveys. consumers. )
This isn’t the only attempt by the public to stop predatory sales practices. On Wednesday, U.S. Sens. Richard Blumenthal (D-Conn.) and Sheldon Whitehouse (D-RI.) introduced the Junk Fee Prevention Act. This would prohibit “excessive hidden and unnecessary fees” from all types of sellers including hotels, concert vendors, airlines, and other ticketing retailers.
The White House also published an update in February on federal efforts to reduce or eliminate junk fees. The Consumer Financial Protection Bureau proposes a cap on late fees for credit cards. These fees would be reduced from $41 to $8 and late fees that exceed 25% of the minimum monthly payment would be banned.