Major Card Brands Roll Out New Changes (XBIZ)

Read the full article by Cathy Beardsley at XBIZ.com 

Visa and Mastercard are shuffling the deck in 2019, impacting the way business is done in the world of payments. Starting this month, Mastercard is requiring more transparency for free trials associated with physical products such as skin care or other healthcare items and recently Visa announced lower chargeback thresholds, to take effect this coming October. Both initiatives focus on reducing chargebacks, a goal we can all get behind. So, rather than panic over the changes, take a closer look and you’ll realize the odds are stacked in your favor.

Our company recently underwent a Mastercard Global Risk Review and gained some insight on the card brand’s new rule governing free trials. Mastercard says it rolled out the rule to go after deceptive practices specifically around physical goods in the health and “nutra” space.

Starting this month, merchants offering these types of products will be required to notify a consumer, either by email or text message, when a free trial period ends and when a regular subscription is about to begin billing. The notification must include: the amount to be billed, the payment date, the merchant name and detailed instructions on how to cancel. Also, before automatic billing can begin, the merchant must obtain the cardholder’s explicit approval. While free trial offers are helpful in increasing sales and improving customer satisfaction, the changes will help increase transparency and eliminate disputes from cardholders who weren’t clear about what they were buying.