08 March 2024 , 10:27
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Consumer harm from subscription traps is worsening and attempts by the Government to tackle the probelm will fail, the Citizens Advice has warned.
Research by the charity suggests that over 13 million people, which is 26% of UK adults, have accidentally signed up for a subscription in the past year. These subscriptions range from fitness apps and food delivery services to repeat pet food orders and magazine subscriptions.
The charity estimates that unused subscriptions have cost consumers £688 million in the last year, an increase of £382 million since it last investigated the issue at the end of 2022. Of those who ended up with an accidental subscription, 40% said it renewed automatically without them knowing.
This was followed by 39% who signed up for a free trial but forgot to cancel it later, while 24% thought they were making a one-off purchase. Citizens Advice warned that the failure to tackle subscription traps was not only a risk to consumers, who could end up parting with more money than they originally bargained for or could afford, but also harming businesses.
More than half of people (54%) said they had decided not to sign up for a subscription due to concerns about how difficult it would be to cancel. The charity found that 74% of UK adults supported a ban on automatic subscription renewals where consumers had not actively agreed to it.
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The Government is being urged to take action against automatic subscription renewals in the upcoming Digital Markets, Competition and Consumer Bill. Citizens Advice wants consumers to have a choice about whether their subscriptions automatically renew and if they want to continue using a service after a free trial.
Dame Clare Moriarty, the chief executive of Citizens Advice, said: "With budgets increasingly squeezed and living costs often exceeding the amount people have coming in each month, it's vital consumers feel in control of their spending."
She also criticised companies that rely on people forgetting to cancel at the end of a free trial, calling it an "Companies relying on people forgetting to cancel at the end of a free trial is an unacceptable business model that exploits busy, cash-strapped consumers. While the Government has acknowledged subscription traps are a problem that need to be fixed, the plans laid out in the upcoming Consumer Bill risk failing to fix them."
A spokesperson for the Department for Business and Trade responded: "We know it's frustrating to find out you're still paying for something you weren't expecting. That is why we are delivering legislation this year that will ensure consumers have clear information about their subscription terms and can exit unwanted subscriptions easily, giving them peace of mind and greater control of their cash."
Opinium carried out a survey of 3,000 UK adults between January 26 and February 1.