Complaints related to subscriptions continue to escalate in 2022, with 330 cases being recorded by the consumer advice body UK International Consumer Centre in the second quarter of 2022 compared to 186 in the second quarter of 2021.
This 77% increase is driven by complaints about travel-related subscriptions – with companies based overseas - and also subscriptions for online services such as dating services.
UK consumers tell the UKICC that they often don’t know that they have entered into a subscription contract until a payment is taken from their card. And then they sometimes have trouble cancelling the subscription.
Service Director at the UK International Consumer Centre, Andy Allen, said: “During the COVID-19 pandemic many UK consumers found themselves hankering after overseas travel. Some fed that desire for a cheap travel deal by arranging a bargain for the future, without necessarily realising that they were entering a travel subscription.
“With the rising cost of living crisis and the squeeze on everyone’s budgets, we can quite see that this trend could grow.”
A travel subscription or membership is where a travel agent charges a consumer an annual/monthly fee for access to cheaper travel rates, usually the purchase of flight tickets but occasionally accommodation and/or holiday bookings too. The arrangement is determined by the individual company and is usually detailed in their terms and conditions.
Another example of where subscription services can go wrong for consumers is in the area of online dating services.
Andy added: “UK consumers hoping to find love can also get caught out when they try to find love online.
"Registering on an online dating website can become costly for some consumers, especially if they are not aware of the cancellation terms of their contract or alternatively have not been able to cancel. This is one of the main reasons that people who complain about dating websites become angry and contact the UKICC for help."
As a general rule, users of online dating services have a right to withdraw from the service within 14 days. Within this time, the provider must refund the membership fees.
Complaints about subscription services span a variety of issues, but are often made by consumers who have entered into contracts, sometimes on a trial basis, but have been unable to cancel and in some cases are being pursued for payment by a debt collector.
Termination of membership can be one of the main drawbacks. Terms and conditions of a contract are important here; essentially consumers should be informed about any automatic renewal and how they can cancel membership.
Andy added: "Essentially, consumers should ensure they know what they are getting into when they sign up to dating websites. Looking for a partner can be an emotive issue. If you are looking for love online, you can be in an emotional place which means you can be quite vulnerable and trusting towards both the people you are likely to meet as well as the online dating services themselves."
Subscription traps are one of the main areas which the UK Government said it wanted to tackle in its proposals for Reforming Competition and Consumer Policy, issued in summer 2021. In April this year (2022), the Government announced that it planned to stop subscription traps, in which businesses make it difficult to exit a contract.
In the Government’s consultation response document, it is estimated that consumers may spend as much as £1.8 billion per year on subscriptions which they regard as poor value for money.
Under new rules, businesses will have to:
- provide clearer information to consumers before they enter a subscription contract
- issue a reminder to consumers that a free trial or low-cost introductory offer is coming to an end, and a reminder before a contract auto-renews onto a new term
- ensure consumers can exit a contract in a straightforward, cost-effective and timely way
Consumers can make contact with the UK International Consumer Centre via the website – www.ukecc.net – or by phone on 01268 886690 Monday-Friday between 10am and 4pm.