New Mastercard standards for subscriptions, recurring payments, and negative option billing models

Mastercard has revised the rules around subscription, recurring, and negative option billing payments. We’ve updated our documentation to align with these rules and included a summary of the changes in this article.

Subscriptions and recurring payments

From September 22, 2022, all merchants who offer their shoppers a subscription service must show the basic terms of the subscription at the point of payment and capture the cardholder’s acceptance of those terms.

Additionally, your recurring and subscription payments should already meet the following standards:

• You must send a confirmation by email or other electronic method when a customer enrolls in a subscription or recurring billing plan. This must provide the terms of the subscription, including the terms of a trial period when applicable, and clear instructions on how to cancel the subscription

• After every billing, you must send an email or electronic receipt that includes clear instructions on how to cancel the subscription

• You must provide an online or electronic cancellation method (similar to unsubscribing from email messages or any other electronic method)

• For any subscription / recurring payment plan that bills a cardholder less frequently than every six months (180 days), you must send a notification to the cardholder at least seven days and no more than 30 days before the billing date. The notification needs to include the terms of the subscription and instructions about how they can cancel it

Negative option billing rules

Also from September 22, 2022, if you offer a negative billing option (a free or low-cost trial period of digital goods) and your customer is then enrolled into a subscription plan at the end of this negative billing period, you must:

• Send a reminder by email or other electronic method no less than three days and no more than seven days before the end of the trial period. The notification needs to include the terms of the subscription and instructions about how the cardholder can cancel it

Note: This negative option billing requirement only applies to digital goods and services.