Beware of Online Subscription Traps, Warns Citizens Advice Scotland
March 15, 2016
Consumers across Scotland have been warned to watch out for traps laid by online service providers who use underhand tactics to trick unsuspected people into long-term financial commitments.
Citizens Advice Scotland has said that the issue is an increasingly serious one with more and more people apparently agreeing to make regular monthly payments for long periods without really understanding what they’re signing up for.
Part of the problem is that consumers often find themselves agreeing to the terms of Continuous Payment Authorities (CPAs), which effectively allow service providers to take money directly from people’s bank or credit card accounts.
Unlike with Direct Debits, CPAs allow companies to alter the amounts being charged as they choose which can soon leave consumers with a serious financial headache.
Worryingly, research from Citizens Advice Scotland has found that roughly 81,000 Scots have been prevented from cancelling a CPA subscription despite the fact that they have a legal right to do so.
Furthermore, some 75 per cent of all Scots, which equates to around 4 million people, do not know the difference between Direct Debits and CPAs, according to Citizens Advice research.
“Many online companies are luring people into signing up for long-term subscriptions, often without even realising it,” said Fraser Sutherland from Citizens Advice Scotland.
“We’ve all seen pop-up adverts for a ‘free trial,’ e.g. of a healthcare product, like slimming pills. Unfortunately in many cases these end up being anything but free.
“The internet is a fantastic tool for consumers, but it brings with it many traps and scams. We need to iron these out, so that people can enjoy the online experience without having to worry about whether they are being exploited.”
More than 2 million Scots are believed to have signed up for some form of CPA over the course of the past 12 months.
As many as 30,000 people living in Scotland are thought to have been rejected by their banks after making requests for specific CPAs to be stopped, despite high street banks being legally obliged to stop these authorities on request.
If you are finding it difficult to manage your personal finances, Scotland Debt Solutions may be able to help. Call us today to arrange a free consultation.
Your personal credit score plays an important part in securing new loans and credit, and can affect your financial life for better or worse. Lenders use the information in your credit file to determine whether you present a high risk of default, and if your credit score is low, you may find it difficult to […]
Credit unions offer a range of financial products including current accounts, savings accounts, and loans, and can be a good alternative to banks and building societies whilst also helping your cash flow. There are credit unions all around the UK, almost 100 of them operating in Scotland. They’re not always widely advertised, however, and although […]
It’s a worrying situation when you realise your outgoings exceed your income, and it can be difficult to prevent debt in this situation, but there are solid steps you can take to get back on track – you just need to act quickly. Increasing your income or reducing the money going out are essentially what […]
If you’ve lost your job, state benefits and tax credits can provide vital financial support to see you through this tough time and help you avoid taking on too much debt while you look for more work. As far as your old employment is concerned, it’s important that you check your final wage slip to […]
If you are a Scottish resident in financial difficulty, you may have entered into a Trust Deed in order to restructure debt repayments to creditors. A Trust Deed is a fixed voluntary agreement made between the debtor and creditor, with the help of a trustee. Debt is broken down into smaller, affordable instalments, typically lasting […]
A Debt Arrangement Scheme (DAS) is a government backed scheme which allows you to repay debt through contractual, monthly instalments without the threat of legal action and incurring penalties or interest. The scheme was established in 2004 for Scottish residents in debt, providing an alternative solution to sequestration, the Scottish equivalent of bankruptcy. A Debt […]