Recurring Payments and Free Trials

Recurring payments are an authority between you and a merchant, whereby the merchant deducts funds on a recurring basis from your credit card or Visa Debit card (where you’ve quoted your card number).

Recurring payments are usually established for bills for common service providers including mobile phones or gym memberships, or for participation in a free trial product or service.

A recurring payment authority authorises a merchant to deduct funds from your credit card or bank account linked to your Visa Debit card on an on-going basis and is subject to the International Card Scheme rules for Visa and Mastercard®.

A direct debit authority authorises a merchant to deduct funds from your transaction or savings account on an on-going basis and is processed through the Bulk Electronic Clearing System (BECS). Under the BECS rules, the account holder can request their financial institution to stop a direct debit on an account.

Within the terms and conditions, you may find:

• Your participation in the trial means you agree to all their terms and conditions
• The free trial period often begins on the ‘original order date’. If the trial period is only for 14 days and your product is coming from overseas, sometimes you may only have a small window of opportunity to trial it
• If you’re unsatisfied with the product, the cancellation policy may be difficult to achieve. For example: some free trials state goods must be returned within 15 days from the original order date. The un-used portion or empty packaging must be returned at your expense and with a valid ‘Returned Merchandise Authorisation’ number, obtained by contacting their customer service
• The full cost of the product may be charged to you once the trial period ends. There may also be an ongoing paid membership fee (usually monthly) which can be for the full amount of the product plus any postage and handling
• The full cost of the product and also the ongoing membership fees may be written in words so it’s not easily identified if you’re scanning the terms and conditions. For example: seventy nine dollars and ninety five cents, instead of $79.95
• They’ll only accept a credit card. They may not accept cash, cheque, BPAY® or money orders because this restricts their ability to charge you ongoing membership fees once the trial period is over
• Your participation in the trial may result in offers of member discounts and promotions. This can mean your personal details will be shared with their associated companies which can lead to further direct marketing. It may also create problems if you want to revoke a recurring payment authority because a single cancellation to the parent company may not suffice.