The cardholder claims they were still charged even though they canceled their subscription or revoked their permission to the recurrent billing arrangement.
Cause
The merchant fails to cancel a recurring transaction as requested.
The merchant proceeds to process a transaction after getting a notification the cardholder’s account is closed.
The cardholder withdraws consent to charge their account or canceled the subscription payment.
Response
Cardholders and issuers have no limit to the number of days they have to to file a dispute related to the claim against the merchant.
Merchants have 20 days to respond to the claim in dispute.
Steps to Prevention
Send the cardholder a notification after you cancel the recurring payment.
If there are new fees after the cancelation, inform the cardholder about it and how to handle them.
Clearly communicate the cancelation policy and have it easy to find.
Remind the customer of the upcoming charge, especially if there’s a significant amount of time between billing cycles.
