Can I Dispute a Recurring Charge on My Card?

Recurring charges, such as subscriptions or automatic bill payments, are a common feature of modern financial life. They offer convenience by automating payments. However, charges can be incorrect, unauthorized, or for services no longer desired. In such cases, consumers may need to dispute the charge on their card statement.

Understanding Valid Reasons for Dispute

Consumers have several legitimate reasons to dispute a recurring charge. One common reason involves unrecognized or unauthorized charges, which can occur if fraudulent activity is suspected, if a charge appears after a service was supposedly canceled, or if a free trial automatically converted to a paid subscription without clear consent. For example, if a free trial period ends and a subscription fee is applied without an explicit opt-in, this could be considered an unauthorized charge.

Billing errors also present a valid basis for dispute. These errors include instances where an incorrect amount was charged, or when duplicate charges appear on the statement. Such discrepancies might stem from merchant processing errors or system glitches. Additionally, if goods or services were paid for but never received, or if they were received but found to be defective or misrepresented, a dispute may be warranted. Finally, if a consumer properly followed a merchant’s cancellation procedures for a recurring service, but charges continued to appear, this also constitutes a valid reason to dispute the transactions.

Information Gathering for a Dispute

Before initiating a dispute, gathering specific information and documentation is important to build a strong case. This includes precise transaction details: the exact date, amount, merchant’s name as it appears on the statement, and any unique transaction identification numbers. These details are typically found on your account statements.

It is also beneficial to collect proof of purchase or subscription agreements, such as contracts, terms of service, or confirmation emails. Any correspondence with the merchant, like emails, chat logs, or detailed notes from phone calls (including dates, times, and names of representatives), should be retained. If the dispute involves a failed cancellation, evidence of your attempts, such as confirmation numbers, cancellation emails, or call logs, is essential. A clear description of the goods or services involved, along with any relevant terms and conditions you agreed to, strengthens your position.

Disputing Directly with the Merchant

The initial step in resolving a recurring charge dispute often involves contacting the merchant directly. Begin by locating the merchant’s customer service or billing department contact information, which can usually be found on their website, on your billing statement, or through an online search. While a phone call can be a quick way to initiate contact, following up with a written communication, such as an email or a formal letter, is advisable to create a clear record of your interaction.

In your communication, clearly state the reason for your dispute, referencing the specific transaction details you gathered, such as the date, amount, and transaction ID. Articulate the desired resolution, whether it is a full refund, a partial refund, or the immediate cancellation of the recurring service. Keep meticulous records of all communications, noting the dates, times, names of representatives, and a summary of what was discussed. Merchants typically have a process for handling these inquiries, and while response times can vary, a response might be expected within a few business days to a week or two. If a resolution is not reached within a reasonable timeframe, or if the merchant is unresponsive, further action may be necessary.

Disputing with Your Financial Institution

If attempts to resolve the issue directly with the merchant are unsuccessful, the next step involves disputing the recurring charge with your card-issuing financial institution. You can typically contact your bank’s fraud or dispute department via phone, through their online banking portal, or by visiting a local branch. When you initiate this formal claim, often referred to as a chargeback, the bank will require specific information, drawing from the details you gathered earlier, such as transaction records and any correspondence with the merchant.

For credit card disputes, protections are provided under the Fair Credit Billing Act. This federal law sets specific timelines and procedures for resolving billing errors, including unauthorized charges. Under the FCBA, consumers generally have 60 days from the date they receive their statement to notify their credit card company of a billing error. The card issuer must acknowledge your dispute in writing within 30 days and complete its investigation within two billing cycles, typically no more than 90 days. During this investigation, the bank may issue a provisional credit to your account while they communicate with the merchant and review evidence from both parties.

For debit card transactions, similar consumer protections are available under Regulation E of the Electronic Fund Transfer Act. This regulation limits consumer liability for unauthorized electronic fund transfers, depending on how quickly the unauthorized activity is reported. For instance, liability is limited to $50 if reported within two business days of learning of the loss or theft, but can increase to $500 if reported after two business days but within 60 calendar days. The bank’s investigation process for debit card disputes also involves specific timelines, and they may provide provisional credit within 10 business days while conducting their full investigation, which can take up to 45 or 90 days. The final decision from your financial institution will determine whether the charge is permanently reversed.