Simon, in search of romance, signed up to a dating website subscription for a year.

Luckily for him, within months he met the "love of his life".

But without him realising it, his membership had been automatically renewed.

He was shocked to find he was being chased for £358, and threatened with a debt collection agency.

Simon's story is far from unusual. Hundreds of millions of pounds a year are spent on unused subscriptions, according to the consumer watchdog charity the Citizens Advice Bureau (CAB). Most of the people it surveyed recently blamed auto-renewal for this.

Many of us have fallen prey to the so-called subscription trap - signing up to a free trial and then forgetting to cancel it leading to ongoing payments for services we don't use.

In the UK, the government is taking steps towards cracking down on techniques used by large online retailers to try and lock people into subscriptions.

It is proposing new rules which would require firms to send "reminder notices" to customers to make sure they are aware they remain subscribed.

Not everyone is happy about the plans. Disney accused the government of attempting to "micro-manage" the way subscription streamers interact with their customers.

US regulators have also put companies on notice that tactics such as burying notices of auto enrolment violate consumer protection laws.

Amazon became the most high profile target of that fight this month, when it was sued by the US on claims it had tricked customers into signing up for automatically renewing Prime subscriptions and making it difficult to cancel, charges rejected by the online giant.

'I spent £6.99 for 18 months'

A huge range of firms now offer subscriptions ranging from food delivery to contact lenses and it is a growing market. Many offer a free trial, or discounts in exchange for people signing up.

However, people the BBC has spoken to say they feel they have been locked in unintentionally because they have forgotten to cancel their subscription when their free trial period has ended.

John, for example, told the BBC he had signed up to Amazon Prime video for a 30-day free period and forgot to cancel it when he had to start paying for it.

"I'm just gutted I spent £6.99 a month for 18 months for no reason".

A winning business model

For companies like Amazon auto-enrolment is a no brainer, according to research analyst Claire Holubowskyj at Enders Analysis.

She says companies can grow their customer base either by investing continuously to improve their products or by subscription which is an "easier route."

"The customer tries the product once and then is locked in, giving the company a relatively easy revenue stream at no extra cost".

Ms Holubowskyj says that there's been a shift in the consumer mindset in recent years which means we are now used to paying for products and services on a monthly basis, "It's just the done thing now and actually for customers there is a lot of benefit particularly with technology software where updates are just bedded in with the price now."

But subscription models are not necessarily a bad deal for customers, particularly if it enables them to have free products or discounts and many firms do offer reminders to customers when it's time to renew.

The UK government says its draft legislation - the Digital Markets, Competition and Consumers Bill - would "ensure consumers get a fair deal".

But Citizens Advice says it should go further, calling for auto-renewals to be banned altogether and making firms ask people to opt in, rather than opt out of subscriptions after a free trial.

"The government has to acknowledge the pressure on consumers' pockets. This has to be the start of reforms, not the end," says Matthew Upton, executive director of policy and advocacy.

John says he welcomes any attempt to make sure it's harder to be automatically renewed into a subscription, but he says he's still worried that he might get trapped again.

"It was such a stressful ordeal and left me with a lot of anxiety. It ridiculous, these companies only care about the money not the person".

Source:
courtesy of BBC NEWS

by Vishala Sri-Pathma | BBC News

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