New law to stop people accidentally signing up to unwanted monthly subscriptions

The Chancellor will unveil plans in the Budget

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The Government is expected to change the law in a bid to stop consumers accidentally signing up to recurring monthly subscriptions.

Research by Citizens Advice estimates that around two million consumers every year have problems cancelling subscriptions.

Additionally, over 40 per cent of British people are paying for a subscription that they do not use.

Now the Government is to consult on a plan that would require companies to properly notify customers when they are about to take payment for subscriptions.

Amazon’s Prime service automatically enrols people who take free trials for a whole year’s £79 payment if they do not cancel within the trial period.

In March 2015 the Advertising Standards Authority banned Amazon from using direct mail to offer “free trials” after it found the shopping giant was misleading consumers about the cost of the service.

Apple Music, Spotify, and Netflix are also examples of services that renew automatically after a free trial. 

Some companies already provide notifications for consumers when they are about to take payments

The announcement of plans to curb the practice are expected to be laid out by the Chancellor Philip Hammond in his Budget on Wednesday.

The Treasury said the Government would “swiftly develop options to stop people paying unexpected automatic fees for unwanted subscriptions”.

The Chancellor is also expected to announce that he will “examine a range of options” to shorten and simplify the small print in online terms and conditions.

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