Mastercard is implementing new transaction processing requirements
These new requirements enhance cardholder notification, cancellation, and disclosure standards to ensure a more transparent cardholder experience and mitigate risk of negative impacts to the merchant – such as disputes and chargebacks.
New Mastercard rules effective December 8th 2021 regarding cardholder notification and transparency
- Provide a confirmation message by email or any other electronic method at the time of enrollment that outlines :
- the terms of the subscription,
- terms of a trial period (when applicable), and
- clear instructions on how to cancel the subscription.
- Send a receipt by email or any other electronic method after every billing that includes clear instructions on how to cancel the subscription.
- Provide an online or electronic cancellation method.
- For any subscription/recurring payment that bills a cardholder less frequently than every six months, send a notification no less than three and no more than seven days before the billing date that includes the terms of the subscription and instructions about how a cardholder may cancel the subscription
New Mastercard rules effective December 8th 2021 regarding trial-period billing
- Merchants must disclose :
- the terms of a trial period,
- any initial charges,
- the length of the trial period,
- the price and frequency of the subsequent subscription.
- No less than three and no more than seven days before the end of the trial period, or whenever the terms and conditions change, the merchant must send a reminder notification to the cardholder that the subscription will commence if the cardholder does not cancel.
- It must include the basic terms of the subscription and instructions about how to cancel. The notification can be via email or another electronic message.
- Merchants that offer a free or low-cost trial period of a physical good and then automatically enroll the cardholder into a recurring subscription at the end of the trial period are an exception to this trial-period billing requirement.
New Mastercard rules effective June 9th 2022 regarding merchant disclosure
- Clearly disclose the basic terms of the subscription at the point of payment and capture the cardholder’s acceptance of the terms (should include billing price and frequency).
- At the point of online payment, a summary of the subscription/recurring billing order must be shown along with prompts for cardholder payment credentials before submission for authorization.
Note : Mastercard stipulates that providing a link to another page that contains this information or otherwise requiring the cardholder to expand a message box or scroll down the page to see terms WILL NOT satisfy this requirement.