If you have ever found it difficult to cancel a subscription, with a company making you jump through hoops to do so, then the FTC (Federal Trade Commission)’s latest rule will be music to your ears.
The FTC Introduces a New “Click to Cancel” Rule
In 2023, the FTC proposed a rule that would force companies to make it easier to cancel recurring subscriptions. After gathering more than 16,000 comments from consumers, the rule is now being implemented.
Called “Click to Cancel,” the rule insists that businesses make it “as easy for people to withdraw from your program as it was to sign up.” It also means cancelation has to be “offered through the same medium (online, phone, etc.) people used to sign up”.
This is all designed to crack down on businesses making it super easy to sign up for a subscription, but then making consumers jump through hoops to cancel that same subscription. Some will even make you cancel over the phone, and charge extra for the privilege.
The FTC has acted to end this practice based on the thousands of complaints it receives each year. And the number of complaints has risen sharply, from 42/day in 2021 to 70/day in 2024.
The FTC press release states that while some provisions of the rule will go into effect within the next 60 days, most parts won’t be in full effect for 180 days. That gives companies plenty of time to change the way they handle cancelations or risk civil penalties.
Companies Have Preyed on Consumers for Too Long
I suspect that most people reading this will have experienced difficulty in canceling a subscription at some point in the past. And it should have been flagged as being completely unacceptable a long time ago.
While gyms have always had a reputation for making it difficult to cancel a membership, with so many companies having adopted a recurring subscription model, the problem has spread to other industries.
So, in light of how many companies now use subscription models, and how many make it more difficult to cancel than to sign up, this rule is very welcome. While some companies will dislike the rule, if it impacts them in any way, they were likely taking advantage of their customers.
