Visa Updates for Merchants That Offer Trial Subscriptions

To enable greater transparency for customers, Visa is updating its rules related to transactions for merchants that offer free trials or introductory promotions as part of an ongoing subscription service. Starting on the enforcement date of April 18, 2020, Visa will require merchants to provide specific information and resources to cardholders regarding subscription services. These updates are intended to keep cardholders better informed about their purchases. This increased transparency may also help lower chargebacks.

Visa requirements

Here’s the breakdown of the Visa requirements that go into effect on April 18, 2020:

  • Merchants must obtain cardholder consent before entering them into a subscription service.
  • Merchants must provide cardholders a copy of their terms and service conditions at the point of enrollment. Enrollment is considered the point at which the cardholder signs up for a trial or promotional period. These terms must include the following:
    • Cardholder confirmation entering them into the subscription service
    • Subscription start date
    • Details of goods/services
    • Transaction amounts and billing date/frequency
    • Link or simple mechanism to cancel the subscription online
  • Merchants must notify cardholders at least 7 days before the cardholder’s trial or promotional period expires.
  • Merchants must enhance the descriptor of the subscription transaction that immediately follows a trial or promotional period to include a trial reference.
  • For each subscription transaction, merchants must provide a receipt that includes the following details:
    • Trial or promotional details (if applicable)
    • Transaction date and amount, even if the trial or promotion lowers the initial transaction amount to $0
    • Link or simple mechanism to cancel the subscription online

Required technical changes

If you use Braintree subscriptions, we recommend making these technical changes to comply with Visa’s new requirements:

If you use custom subscription logic, we recommend making these technical changes to comply with Visa’s new requirements:

Questions?

For more information about subscriptions, check out our Recurring Billing guide. If you have any questions, contact us.

***
Tim Whicker Tim is a Product Manager under Braintree's Cards Compliance team. In his free time, he's a tech, music, and design enthusiast. More posts by this author

You Might Also Like

    Stay up to date – subscribe to our RSS feed