Unwanted subscriptions are costing people an average of £50 a month because they are too difficult to cancel, according to a new study.
It’s the kind of news story that a financial journalist like me writes up fairly regularly, usually with a section on top tips or ‘your subscription rights’.
But the news story this week caused me a twinge of guilt because, like a lot of people, I too have had unwanted subscriptions taking money from my account month after month because cancelling them was time-consuming and I am forgetful.
However, not only did I cancel a long-term unwanted subscription last month, I also got some of the cash back. Here’s how.
Hang on, who’s paying £50 a month for nothing?
It might sound unbelievable but it really is a widespread problem. The research, carried out by Citizens Advice, found that many companies made it incredibly difficult for people to cancel subscriptions even when they are not using them.
Regular culprits were gym memberships and TV or streaming services. With a rise in the number of subscription services available, including dating and recruitment websites, this is an issue that is only likely to get worse.
Worryingly, nine out of 10 people who had an unwanted subscription said that they had been initially refused when they finally attempted to cancel it.
Sometimes the provider claimed more notice was needed, sometimes they put barriers in the way by saying the customer had to contact them by post or phone.
One person contacted Citizens Advice to say that they had tried to cancel a subscription after being made redundant, only to be asked to provide their P45 as proof.
Guy Parker, chief executive of the Advertising Standards Authority, said: “Promotions which encourage people to sign-up to ongoing payments must be upfront and clear about what exactly they’re agreeing to.
“Burying key information in the terms and conditions can be misleading and unfair and risks leaving consumers out of pocket.”
However, I think that even more must be done to keep customers safe, including me.
Boost your income with a high-interest current account
Okay, how much money did you waste?
Look, I’m not proud of this. I consider myself to be a fairly canny customer; I check I’m on the best deals, I avoid misleading ‘bargains’, I regularly check my bank balance.
Yet each month I noticed a few pounds going out to pay for a credit-checking service I no longer used and that I ashamedly failed to cancel.
The reason is that my subscription stopped updating when I changed my name – the company wanted my wedding certificate, but so did pretty much every company that provided me with a service and so I never got round to posting it to them.
Next time I thought about the service, I couldn’t remember my login information. They wanted my name and details to reinstate the service but I had a different name now.
It all seemed like too much effort and it was only a few pounds each month. Every time I spotted it leave my account I became determined to cancel it by the following month but then a month went by and I had forgotten again.
Well, I recently had my seventh wedding anniversary and realised I’d been paying for nothing for a long time. It was only a small amount each month but over 84 months that had really added up.
And I call myself a money journalist.
How did you stop it?
Last month I emailed the customer service address for the credit checking firm. I explained my position and asked them to cancel my subscription with immediate effect.
It took two weeks but they cancelled it. Then, as a goodwill gesture and without me asking, they offered to refund me 50% of the money I had paid over those years.
Fantastic! That was a great gesture and one they had no legal requirement make. I was pleased. But that doesn’t mean I wasn’t stupid for leaving it so long and losing half the money.
This got me thinking that more should be done to ensure customers are only paying for services they genuinely use.
So what should be done?
I believe that the onus should be on the supplier to ensure the customer still wants their service.
Perhaps not for services such as insurance, where it is genuinely essential that there’s no break in provision.
However, for subscriptions where companies have the tech to see who is actually using their service and not just paying for it, it should be best practice to proactively reach out to the customer and check if they want to cancel.
So things like streaming subscriptions, gym memberships and online web services shouldn't be able to run on indefinitely without any checks at all.
I’d like to see the Government put pressure on industries to make things fairer for customers, and to penalise those providers that Citizens Advice say are deliberately making it hard for customers to quit.
Then, I’d like to see more of us take control of our own bank accounts and cancel such unused subscriptions. You never know, you might even get a goodwill gesture back in time for Christmas.
In fact, while I think of it, my son hasn’t logged into that maths tuition app in eight weeks and I’m paying a tenner a month for that too.
Need to know tips about subscriptions
Now, here are the inevitable tips. These are from Citizens Advice and, in a world where we pay monthly for so many different services, it is a really good idea to read them carefully.
Check what your cancellation rights are
Each supplier can set their own cancellation policy and they don’t need to offer you a right to cancel your subscription early. Make sure the terms and conditions look reasonable before signing up.
Remember you’ve got a cooling off period if you buy online
If you bought the subscription online, the law says you usually have 14 days to get your money back if you change your mind. However, you might not be able to get a refund if you start using the service straight away.
Follow the cancellation policy
Make sure you follow the cancellation policy set out in your contract when you’re ready to end your subscription. Don’t stop your payment without checking what else is required first – otherwise your subscription may not be cancelled and you could be liable for any missed payments.
Challenge unfair T&Cs
There are no strict definitions for what counts as an unfair policy. But if you’re finding it tough or have to give a long period of notice to cancel a subscription, contact the supplier’s customer services department. If this fails go to the supplier’s trade or complaints body or report to Trading Standards via Citizens Advice.
If you see any outgoings on your bank statement that you don't recognise it could be a sign of fraud. Check your credit report for anything suspicious.
What do you think? Should it be down to the customers themselves to cancel payments or should firms take some responsibility? Have your say using the comments below.