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Subscription services: what you need to know

22 March 2016, Sarah-Louise Prouse, Industry Services Executive
subscription services

PhonepayPlus is currently consulting on new and refreshed Guidance. This is part of a series of blog posts exploring some of the topics open for discussion.

The blog talks about the Guidance for subscription services. If you are operating a premium rate service which carries a recurring charge then this piece of Guidance applies to you.

What does the new Guidance say?
We have refreshed the wording of this piece of Guidance to achieve consistency with the Consumer Contracts Regulations (Information Cancellation and Additional Charges) 2013. We explain that activation buttons (or similar functions) contained within the promotion of a subscription service must make clear the obligation to pay with an unambiguous phrase such as ‘PAY £[X] A WEEK’ or similar. Also consumers must be supplied with confirmation of the contract (subscription) in a clear way before charges start.

The other key changes concern robust opt-in and spend reminders.

Robust ‘double opt-in’

The updated Guidance recommends robust ‘double opt-in’ is obtained for all subscription services not only for those costing more than £4.50 in a seven day period. Double opt-in requires the consumer to confirm their initial acceptance of a charge. We believe this will help consumer confidence in premium rate subscription services as well as provide robust verification of consent to charge for providers.

Spend reminders
The refreshed Guidance recognises that in some circumstances it is more practical for the billing message to also serve as the spend reminder for example where the billing cycle matches the frequency of the required spend reminder. We believe this could help the consumer to understand the services to which they are subscribed.

Where the spend reminder is a free message, the updated Guidance now requires this to be stated somewhere within the message but not necessarily always at the beginning. This is because it is possible some consumers may confuse a message beginning ‘FREEMSG’ as spam causing them to delete it without reading the content. The update could also benefit consumers by aiding their understanding of what they have subscribed to.

We want to hear from you
We really want your feedback on this new Guidance - where have we got it right, and where could it be improved?

To view this and all other proposed guidance, and to respond to the consultation, please head to the relevant pages our website.

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