Visa and Mastercard cancelling/modifying automatic rebills
 

Given the current scrutiny banks/lending institutions are receiving on their operations and practices, what is the likelihood that Visa and Mastercard would modify automatic rebills? Many other businesses, besides adult and online content/services sites, depend on automated rebills. Would there be legal grounds to challenge such a move if it does happen?

damn, you're gonna scare people with this thread title

They really would have no reason to do so.
Sort of like one of those old What if comic books where they put up shit that never would actually happen.

I love that Marvel series "What If". What if Peter Parker's Uncle Ben wasn't murdered...

Yea scary title, should've put WHAT IF

It would destroy millions of businesses worldwide. I can't see it happening.

Though they should stop allowing customers to chargeback. That would be a positive change.

I doubt it, what would Netflix do? and all those services that rebill... online gaming, vonage, way too many...

nice threat title btw :1orglaugh

What alternative billing opportunities do you see if this does happen?

One LEGAL ISSUE that might be raised is that selective imposition of a rebilling ban impacts Freedom of speech. Unfortunately, Visa and MC are private companies and can restrict speech rights. Regardless, there is a line of US Supreme Court cases that hold that otherwise private impairments of constitutional rights can become STATE (thereby actionable in federal court) matters if the judicial system is used. There's also a whole slew of state constitutional cases that defer to states' constitutions' greater protections of speech and privacy rights.

:2 cents:

Not going to happen toots.

They can make the merchant banks demand online/operators start sending out monthly invoices to members who are rebilling. So they are perfectly aware they are being charged, and receive an invoice for it like most online transactions.

But they are not going to kill recurring bills hoss.

I don't think so, although this was a concern for many banking institutions for several years. However, they couldn't find a reasonable solution to protect their customers on both sides of the fence. This being said, I expect some kind of change in CC policies in the short/medium term, probably by 2010, I don't think 2009 is a good year to take any kind of measure that could lead to even more financial panic

yeah i almost shit in my pants lol

Good point, Barefootsies. I think they are NOT going to kill recurring billing PER SE. But putting "barriers" to automated rebills--is that outside the realm of probability? ie., Rebills get advanced notice and they can cancel within a certain period of time after getting that Explicit rebill?

makes no sense whatsoever

visa/mc make money off each transaction, there is no incentive to prevent or deters chargebacks, because the merchant foots the bill

From a rational business perspective, I agree with you. However, given the recent "the banks should not have lent to me" mortgage meltdown fingerpointing in the US, this logic might extend to even credit card debt.

Easiest way to kill recurring billing is to require cvv2 confirmation on every transaction for a MID, TID, BIN, MCC... against the rules to store cvv2 type information as a merchant, so anyone that tried that would be fined and terminated. As for the rest, under the current chargeback allowances, chopping the recurring billing would mean most people would lose their accounts due to the drop in transaction volume alone.

There's no other reason for MC/Visa to do it any other way, would just complicate things overly for compliance.

Banks don't want people to stop using credit or stop getting new credit.

However, just as when you get a credit card and it has a maximum limit on it, the bank has a maximum amount of credit they can offer their customers, based on parameters determined by deposits, set aside capital, etc. If you are a customer of Bank A, and you have a 10k card you are not using, you are not doing them any favors. They cannot offer someone else that 10k in credit while you still "own" it. So they cut you off and get someone else who will use it.

They just hope the person using it will pay it back. Over time. With interest.

We had this same conversation 10 years ago...

it's like drug money feeding politics (not that rebills are the same) but it would never stop because it feeds the success of business.

hey on another related subject to visa/mc, maybe you guys heard something about this?that visa/mc was setting lower limits on leisure transactions such as gaming/adult/etc, while keeping regular limits for transactions that are considered necessities for example food/clothing/etc.

I could see it happening. Lets be honest here, the majority of our industry counts on customers forgetting they joined to get long term rebills. I'm not sure how that is "OK" while a xsale under a submit button is not. They are both the same in my eyes, both possibly fucking the consumer.

+1 ...:pimp

fuck, fuck, fuck..

No way, when you sign-up you agree to get re-billed until you cancel. Many businesses count on these practices, weather it's an adult online subscription, magazine subscription, trial then buy infomercial offers like proactive, a movie rental membership or a gym membership. They can't discriminate against one and not the other, they are all based on the same principle.

Good point. If Visa/MC do cancel/modify automatic rebills it is not because they want to do it (they dont want this to happen because it harms their self-interest), it is because it is undertaken "to protect the consumer."

Also, interesting point you made regarding the difference in degree between xsales and rebills to people "who've forgotten they subscribed."

I think more than anything what you are going to see is lower caps on card, No more 25 ans 30k cards, And when you are late, I think they are going to stop the card right there. Even just a couple of days late.

more declines as well

but recurring stops no I dont think thatll ever happen like kk said banks want ppl to use their cards and paying interest

Wrong, they should look over the charge back rules and adjust them.

I am actually wondering if the "they forget to cancell" point actually still is that big of a thing. Sure probably a nice % but I personally don't think the majority of our industry counts on them. I mean damn building a business on hoping that they forget to cancell is not making much sense to me.

But then again I could be wrong ofcourse ;))

I'm not sure if it's content/category specific but it is true that credit limits were being lowered.

people keep biting the hand that feeds them...who knows what can happen. :2 cents:

Given the current economic climate and mass layoffs, do you see this impacting a good chunk of the online entertainment consumer market?

do you fags get off on doom and gloom?

what if a 10/10 chick tonight saw me and winked so i took her home and she gave me head and i told her to get the fuck out of my house?

now that's reality. doom and gloom are for faggots there is much to "worry" about in life why compound it? are you bored?

Good points, Roald. I wonder how big the % is.

If you look at your recurring members log-ins vs how long they have been a member, you would be surprised how many of them have not looked at your site in months. I don't think it's any crazier than building a business model with hidden or forced xsales. Everyone has their angle.

Of course this is where everyone says, "oh no, not our site, blah, blah" but anyone with a recurring business model knows first hand a LOT of their members forget. Especially Japanese guys... wow.

i dont see it happening. to many companies outside adult rely on rebills

Good point. Do you guys think that the heat caused by cross sales might translate to a heavier review of "high risk" transactions?

i hope not :)

wont happen

Visa and MC have brands to protect. Now that they are more recent then not public companies expect them to start protecting those brands.