The Mail on Sunday launches a major campaign today to stop thousands of people falling into the ‘continuous payment’ trap.
This relatively new form of payment can result in regular sums being sucked out of your bank account, often for years.
Backed by leading consumer groups, we are now demanding that companies which set up these payments for a variety of services – everything from gym membership to access to a dating website – provide subscribers with full details about what they are signing up to.
Saga: When Sanchez Manning wrote off her £1,600 Citroen Furio car two years ago she thought that the breakdown cover that came with it was cancelled
He was unable to get hold of LinkedIn to query the payment but managed to cancel future payments by contacting his credit card provider.
When Sanchez Manning wrote off her £1,600 Citroen Furio car two years ago she thought that the breakdown cover that came with it was cancelled.
The 40-year-old journalist from Sheen in South West London says: ‘In January, I noticed £160 disappear out of my bank account. It was for AA breakdown cover even though I have not owned a car for two years. It was nuts.’
She says: ‘The firm claims it wrote to me but I must have missed it as a result of all the junk mail I receive. The AA eventually refunded the subscription fee.’
The Financial Conduct Authority regulates continuous payments. Six years ago, it discovered that some banks were failing to cancel continuous payment authorities when asked to. It threatened the banks with fines unless they cleaned up their act.
Clive Adamson, a director at the regulator, says: ‘Some customers have struggled with their bank over continuous payments and we have made it clear that this is unacceptable. Customers can finally be confident that when they ask for a continuous payment authority to be cancelled this will be done.’
But cancelling a payment does not mean you will get a refund for money that has already gone out – and you may still be liable for future payments if you have agreed to this when signing a contract.
As a courtesy – and further check – tell both the service provider and card issuer when stopping payments. If a continuous payment authority has not been cancelled despite your request, contact the Financial Ombudsman Service via website financial-ombudsman.org.uk or call 0800 023 4567.
While the banking trade body UK Finance admits it would be possible to highlight continuous payment authorities better on bank statements, it is not keen to take responsibility. A UK Finance spokesman says: ‘Consumers often value the way continuous payment authorities are easy to set up.’
Tim Dawson, a director at ProductionBase, says: ‘If you wish to subscribe to our service you must be signed up to payment systems PayPal or Worldpay. If you do not wish to renew a subscription contact us directly or through these payments services.’
An AA spokesman says: ‘You can contact us any time during the policy period to request we do not auto-renew and we send a reminder six weeks before renewal where there is an opportunity to cancel it.’
Despite being valued at £20billion by its owner Microsoft, LinkedIn does not provide any UK phone number – and failed to respond to our request for a comment.