The Mail on Sunday has been inundated with support for our campaign to crack down on the continuous payment authorities racket.
Scores of readers – most spitting feathers – have shared their shocking stories about a practice that leads to a staggering £7.5billion a year being sucked out of customers’ bank accounts.
Often victims are oblivious to the fact that their accounts or credit cards have been legally pickpocketed. More than 20million people have been lured into taking out these pernicious plans in recent years – tricked by a slick sales pitch that explains the handing over of a simple credit or debit card number will make the whole payment process hassle free.
Jeff Modett, from Lowestoft in Suffolk had a continuous payment authority with home emergency cover provider HomeServe
Jeff Modett, from Lowestoft in Suffolk, stands four square behind our campaign. The 76-year-old retired company director says: ‘I had a continuous payment authority with home emergency cover provider HomeServe.
‘My annual premiums were increased by £27 without me realising – it was only when I noticed the extra charge on my bank statement I discovered what they had done and immediately cancelled.’
He adds: ‘I fear such services prey on the most vulnerable in society. Those that do not regularly check their statements or who are too trusting are most likely to be victims of this sneaky cash grab.’
Only about a fifth of all customers realise there is any difference between continuous payment plans compared to a direct debit or standing order. One of the key problems with a CPA is that money is regularly taken from a credit or debit card – and automatically renewed so easy to forget about and not cancel.
In contrast, every time a service provider wants money from someone who is signed up to a direct debit it must ask the customer’s bank for permission when the payment is due.
A standing order is a regular fixed payment taken from a bank account under an agreement set up by the customer with their bank – not the firm providing the service. It continues until the customer cancels or the standing order contract runs out.
HomeServe says: ‘All pricing and methods of payment are communicated to customers 28 days before renewal.’ Match.com says: ‘Subscriptions are automatically renewed for convenience. We reimburse customers where proof of cancellation is provided.’
Elite Singles says: ‘Subscribers are informed about automatic renewal and can cancel via the account page.’
Now copy this letter to stop the payments for good
[Service provider name and address]
I have been a customer of [company name]
since [date] and have paid for the service using a
continuous payment authority.
Now I am withdrawing this authorisation and do not want any further payments to be taken from either my debit or credit card.
The last four digits of the card these payments are being taken from are [xxxx].
Under ‘The Payment Services Directive 2015’ any more payments taken from the card will be an unauthorised transaction.
Please send a confirmation you have done this.