What type of promotions or introductory offers are in-scope of the updated policy?
The updated policy applies to merchants that provide goods or services through a subscription service (i.e., a recurring transaction), where the subscription agreement with the cardholder includes either of the following:
- Free trial: An initial period at zero cost to the cardholder to use the merchant’s service before the merchant’s regular price is applied for ongoing usage of the subscription.
- Discounted introductory offer or promotional period: An initial period with a preliminary cost to the cardholder that is clearly marketed, communicated, advertised, or promoted to the cardholder as a discount to the merchant’s regular price before the merchant’s regular price is applied for ongoing usage of the subscription after the initial discounted period.
The updated policy does not apply in the following scenarios:
- Where the cardholder uses a discount code or voucher to reduce the merchant’s regular price at the time of completing the subscription enrollment with the merchant.
- A merchant’s regular pricing schedule increases over the term of the subscription agreement, which is disclosed to, and accepted by, the cardholder at the time of completing the subscription enrollment with the merchant.
- An offer of a satisfaction or “money back” or refund guarantee is provided at the time the cardholder agrees to the merchant’s regular price when completing the subscription enrollment with the merchant.
s the updated policy apply to additional services provided to existing customers?
Yes, if both:
- An existing cardholder agrees to add an extra or supplementary service, which is charged in addition to their existing service(s); and
- The offer of payment of the extra or supplementary service includes a free trial or discounted introductory offer or promotional period, as outlined above.
An example of this scenario is a cable TV customer adding an extra paid channel subscription to their existing subscription package.
Can the terms and conditions of the payment be combined with other terms and conditions, or included in a separate link?
No. Visa’s rules for merchants using a stored credential (“card on file”) require that the merchant displays—and the cardholder accepts—the terms and conditions of payment separately from any other general terms and conditions applicable to the goods or service being purchased by the cardholder.
What if the trial or promotional period is seven or fewer days?
If the merchant’s trial or discounted introductory offer or promotional period is seven or fewer days, the initial confirmation provided to the cardholder should include the details required in the reminder (i.e., date of expiration of the trial or discounted promotional period, link, or other simple mechanism to cancel the subscription, etc.).
Where and when is the enhanced descriptor required?
The enhanced descriptor (e.g., “end trial”) is to be included in the Merchant Name field of the clearing record for the first transaction at the end of a trial or discounted promotional period, to provide further notice to the cardholder that the trial has ended and the regular price now applies for the subscription. It is not required for subsequent transactions.
What if the merchant’s billing system cannot amend the Merchant Name field to include the enhanced descriptor?
Visa is not restricting the word choice of the enhanced descriptor, as long as the merchant can identify for the cardholder and issuer that the recurring transaction is the result of a subscription that began with a trial period, discounted introductory offer, or promotional period, etc. Merchants may use other language or transaction-specific details (e.g., URL or order number) to help the cardholder identify that their trial period, discounted introductory offer, or promotional period has ended, and that the regular price now applies for the subscription.
Alternatively, the merchant may leverage the Merchant City field to include this descriptor, in place of the URL or customer service phone number or email address.
What is the enhanced descriptor for?
The enhanced descriptor (e.g., “end trial”) for the first transaction at the end of a trial or discounted promotional period is intended to provide further notice to the cardholder that the trial or discounted introductory offer or promotional period has ended, and the regular price now applies for the subscription. It is not required for subsequent transactions.
This descriptor will then appear on cardholder statements, online banking, mobile apps, and text alerts in the same way discretionary data or additional invoice or order numbers appear for e-commerce transactions today, to identify the nature of the transaction. What about local legal requirements in my state or country?
Visa’s rules apply globally as a condition of accepting Visa cards. However, in the event of any conflict between the Visa Rules and any applicable laws or regulations, the requirements of the laws or regulations govern.