Mastercard is implementing new rules for merchants using subscriptions and recurring billing

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

1. 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.
2. Send a receipt by email or any other electronic method after every billing that includes clear instructions on how to cancel the subscription.
3. Provide an online or electronic cancellation method.
4. 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

1. 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.
2. 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.
3. 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.
4. 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

1. 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).
2. 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.