Two million people 'trapped' paying for unwanted subscriptions

A process known as Continuous Payment Authority means that payments keep being taking.

An astonishing two million people have found themselves trapped paying for unwanted subscriptions on their credit and debt cards, according to a new report from Citizens Advice.

Many people are signed up to these subscriptions via what are known as Continuous Payment Authorities without their knowledge. This usually happens after you have taken up an offer for a free trial only to find regular payments are taken afterwards.

The fact these ongoing payments are going to be taken is often hidden among the terms and conditions. The companies often obtain your card details by asking for postage for the ‘free trial’.

“Around a million Scots last year had reason to cancel a recurring payment,” says Fraser Sutherland, consumer spokesperson for Citizens Advice Scotland. “Some of these of course will be legitimate cases where people have simply changed their minds, but we know from the number of clients we help on the subject that many thousands are being duped into subscriptions they didn’t want.”

Across the UK Citizens Advice found that four in five people who had a problem with unwanted recurring payments didn’t realise they had signed up until money was taken from their accounts. The payments average £80 but some people said they had lost hundreds of pounds.

“As the Government launches a review into terms and conditions in consumer contracts there is an opportunity to make much clearer to people the exact amount they will have to pay when they are signing up to recurring payments,” says Gillian Guy, chief executive at Citizens Advice.

How to escape

You should be able to cancel a recurring payment either with the seller of your credit or debit card issuer, according to the UK Cards Association. But many people are struggling to do that.

A survey of 2,000 people found that 8% of people who had tried to cancel a recurring payment were refused either by their card issuer or the seller.

“All too often card companies and sellers are standing in the way of people ending recurring payments because they wrongly refuse to cancel,” says Guy. “People are trapped into losing hundreds of pounds because they can’t cancel payments.”

Spotting recurring payments can be difficult as they aren’t labelled as such. You need to check back through your statements and see if you are paying the same company repeatedly. If you see any repeated payments firstly contact the retailer and ask them to cancel the payment.

If they refuse, check if you are locked into a contract. If you aren’t then contact your bank or credit card provider and ask them to cancel the payment. Since 2009 they are required by law to cancel the payment if you ask them to.

After this point you can reclaim any further payments from your bank or credit card provider if they fail to stop the payments. You need to make a formal complaint to the bank or card provider telling them in writing when you asked for the payments to end and how much money has been taken.

They should then assist you in cancelling the payments and give you a refund.

If all else fails then you can take your complaint to the Financial Ombudsman Service who will look into it on your behalf.