The Prime Minister’s ban on subscription traps has been brought forward three months, forcing retailers to vet their cancellation process today.
- Burnham’s ban on subscription traps will now take effect in January 2027, instead of Spring
- Certain online retailers will need to overhaul their subscription process to avoid facing penalties
- Non-compliant businesses also risk being name-and-shamed, and damaging customer trust
New Prime Minister Andy Burnham has brought his plans to ban subscription traps forward to January, ahead of their original spring timeline. The move is part of a series of everyday fixes he’s rolling out to help lower the cost of living.
Subscription traps have long been a sore point for consumers, with difficult cancel processes costing UK households an estimated £1.6 billion a year in unwanted subscriptions.
To avoid facing penalties, some online retailers will need to overhaul how they handle subscriptions, including giving clearer information at sign-up, sending customers regular reminders about subscriptions, and giving customers a 14-day cooling off period after a free trial ends.
Burnham is banning subscription traps in clamp down on rip-off business practices
Online subscriptions continue to be huge revenue drivers for UK online retail stores, with research from Finder showing that 88% of UK adults use at least one subscription service.
However, for many customers, this convenience has come with a trade-off. According to the Department of Business and Trade, there are currently almost 10 million unwanted, active subscriptions across the UK, with a further 1.3 million users caught out by auto-renewals.
New Prime Minister Andy Burnham recognizes this problem, and his plan to prohibit subscription traps to give consumers “room to breathe” amid rising costs has been brought forward to January 2027. The government estimates these changes would save consumers up to £400 million a year in total – working out to around £170 per person.
In addition to these proposed changes, Burnham is also outlawing shops from falsely claiming products have been retailed at much higher prices, as he believes this tricks shoppers into thinking they are getting a much better deal then they are.
How to vet you cancellation processes to avoid penalties
With the ban now just months away from being enforced, now is a good time for retail businesses to review their sign-up and cancellation processes.
Businesses that fail to comply with the pending regulations risk being levied with fines, and being named and shamed by customer groups like Which?, which has vowed to expose companies using “dodgy deals”.
Non-compliance could also damage customer trust. As cost of living pressures force customers to scrutinise their spending more closely, buyers continue moving towards brands they trust, and avoiding those that make it difficult for them to leave.
It doesn’t need to come to this though, as long as you get ahead of the changes, rather than waiting until January to act.
- Audit your sign-up flow – Make sure pricing, contract length, and terms are clearly stated up-front, instead of hiding critical information in the small print
- Send out reminder emails – Notify customers ahead of renewals, especially when free trials are about to come to an end
- Make cancelling as easy as signing-up – Cut out unnecessary friction like mandatory phone calls and web-only cancellations
- Introduce a 14-day cooling off period – Give customers the right to cancel without a penalty after the trial comes to an end
