Credit cards and auto-renewal of contracts

DullGreyGuy

surreysaver said:

First thing I do when buying something with a continuous payment authority, is cancel the continuous payment authority. Although this can be laborious with some organisations, as they obviously want you to forget that you've got an automatic renewal, so it is sort of a 'scam', as they know people will forget, or won't bother to cancel, a continuous payment authority.
I just keep a diary of when things renew that I may actually want to renew 

How is people being lazy or forgetful a scam? A scam involves dishonesty or fraud. 

Is it a scam that your local cornershop sells things more expensive than a supermarket? They are in part relying on the fact people are lazy and it's easier to go across the road to get a pint of milk than to take 2 buses to the supermarket.

Remember legally not paying is not the same as cancelling a contract, its technically a breach of contract which could mean you incur fees and issues with debt collectors (obv the higher the value the more likely it becomes). Rather than cancelling the CPA you are much better doing your second approach which is to diary the cancellation and act on that diary note. 

I'd actually say companies are getting better these days, increasingly you can give prior notification of your intent not to renew but still get the full period already paid for... historically companies were much more of the mindset that if you say you don't want it today your service stops today and no refund for the unused component. Have cancelled a few software packages recently and all allowed early notification without impacting services.

surreysaver

Of course its a scam - companies know people don't know there's a continuous payment authority, or that they forget to cancel it. Or purposefully make it difficult to cancel it.

prettyandfluffy

surreysaver said:

Of course it's a scam - companies know people don't know there's a continuous payment authority, or that they forget to cancel it. Or purposefully make it difficult to cancel it.

A scam is fraudulent so by definition this is not.  It may be exploiting the tendency of people to overlook this type of transaction but it is not fraudulent.

surreysaver

If they know people unwittingly allow a contract to renew, that is therefore fraud, and therefore a scam.
The way around it would be for companies to allow a customer to explicitly opt in to an auto renewal, rather than leave it in small print 

born_again

surreysaver said:

First thing I do when buying something with a continuous payment authority, is cancel the continuous payment authority. Although this can be laborious with some organisations, as they obviously want you to forget that you've got an automatic renewal, so it is sort of a 'scam', as they know people will forget, or won't bother to cancel, a continuous payment authority.
I just keep a diary of when things renew that I may actually want to renew 

Just ask the people that got caught driving with no insurance if it's a perceived "Scam" As they don't think so.. As had they had a CPA, they would not have been stopped, had car impounded & potential points on licence..

km1500

a scam does not have to be fraudulent it can be perfectly legal and still be a scam

Nasqueron

km1500 said:

a scam does not have to be fraudulent it can be perfectly legal and still be a scam

This argument is becoming a matter of pedantry but that definition doesn't work. A scam may technically be legal but it still involves a fraud or dishonesty, to quote Cambridge dictionary, to scam is:

to trick someone into giving you money or giving you some advantage, in a dishonest and often illegal way

If someone signs up for a CPA, confirming they read the terms and conditions which authorised the firm to do so, it is by definition not a scam as they agreed to it. The firm may hope people forget to cancel but when they told you up front what they were doing and explained how to avoid such a charge, it is not a scam