Visa’s New Mandate: What Free Trial & Subscription Merchants Need to Know

visa update v1

By April 18th, 2020, merchants offering introductory trials or promotions which roll into subscriptions have some changes to make. Visa has released a directive to enable “greater transparency, choice, and control for customers.” Mostly, Visa is helping merchants to make it crystal clear when cardholders will be automatically enrolled into paid subscriptions and easier for them to cancel.

Why now?

Visa has found that the number of chargebacks received by subscription businesses offering free trials or introductory promotions has been relatively high. To better protect both customers and merchants, they’re implementing changes which provide more clarity around subscription agreements. Their rationale is that these measures will help minimise disputes.

Does this apply to my business?

If your organisation offers free trials or introductory offers as part of an ongoing subscription, then yes, this applies to your business. Keep in mind that these requirements apply to both physical and digital goods and services.  

What changes need to be made?

The updates focus on ways to help communicate the nature of the free trial or subscription agreement that cardholders enter into. Changes include updates to receipts, electronic notifications, consent requirements and ways cardholders may cancel agreements. Also, dispute rights are being broadened.

Express Consent and Notification
  1. At the time of sign up, cardholders must have a way to expressly consent that they are entering into a subscription service agreement that rolls into recurring payments.
  2. Merchants must send a reminder notification to cardholders via email or text/SMS including a link to an online cancellation policy at least 7 days before the recurring transaction begins.
Easy Cancellation

The merchant must offer a way to cancel the subscription or payment method online. For example, cardholders must be able to easily remove themselves from the agreement without having to reach out to the merchant offline such as via phone or mail.

Statement Descriptor

The merchant must add a descriptor which clearly indicates a trial-period related transaction in the Merchant Name field of the Clearing Record. This must be added for the first transaction after the end of a trial period. The descriptor can be along the lines of “trial”, “trial period”, or “free trial”. This descriptor will then appear on cardholder statements, online banking, mobile apps, and SMS/text alerts.

Explicit Transaction Receipts

Receipts must provide information about the subscription agreement. They must detail:

  1. The length of the trial period.
  2. A clear disclosure that cardholders will be charged if they don’t cancel online.
  3. The transaction amount and date of the initial transaction.
  4. A link or other simple way for cardholders to cancel online.
Expanded Dispute Rights

Dispute conditions of “Misrepresentation” are being extended for transactions purchased through a trial period and when the cardholder is not explicitly aware of a further billing.  Based on this new directive, merchants will have many ways to showcase they have acted in line with Visa’s policies. For example, they’ll be able to show the express consent from the customer agreeing to future transactions and the electronic communication notifying the customer of the trial period ending.

How is Truevo supporting merchants with this transition?

Truevo is assisting merchants with updating their enhanced descriptor  (e.g., “trial”, “trial period”, “free trial”) in an existing field that both issuers and cardholders receive. We support our merchants to ensure the change is made correctly and that all parties are aware of the nature of these types of transactions.

We regularly monitor all our merchants to ensure they are compliant with card scheme rules and regulations. In this particular case, we are keeping an eye out for merchants who offer subscription services and checking to make sure they are applying the new parameters successfully.

As for new merchants to Truevo, we’re asking all applicants if they offer subscriptions. Those which fall under the new mandate’s policies are provided with an enhanced setup process and supported so the correct transaction flow is implemented.

I’ve made my updates. Am I compliant?

Ask yourself the following questions.

  • Do I have an area on my payments page which obtains express consent from my customers?
  • Am I sending electronic notifications to my customers?
  • Do my electronic notifications offer an easy mechanism for customers to cancel their subscription without needing to contact my business offline?
  • Have I provided the enhanced descriptor which identifies the nature of the transaction to my customer?
  • Do my receipts explicitly communicate the terms and conditions of my subscription?

If your answers to the above are yes, feel confident that you are compliant. Still have questions or would like to double-check you are satisfying all of the requirements? Reach out to our team at or to your acquirer for further details.

Barbara Zamponi
Barbara Zamponi
Chief Risk Officer at Truevo Payments
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Disclaimer: This content has been written for informational purposes only. It should not be construed as legal or business advice.

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