Why Most Banks Still Can't Cancel a Credit Card Subscription for You

Vibhu Arya is a global payments professional, formerly with IKEA, Citi, Adyen, and Delivery Hero. He is a PhD researcher at the University of Technology Sydney, studying competition, choice, sovereignty, and innovation in payment ecosystems worldwide.

Subscriptions are the default ways people pay for digital life: streaming, software, gaming, cloud storage, news, fitness, and increasingly AI tools. Streaming alone shows the scale. Netflix counts more than 325 million paid subscribers worldwide. The clearest picture, though, comes from the US. A Harris Poll survey of more than 3,000 adults, commissioned by Zuora, found more than two in three American consumers had added at least one new subscription in 2024. And Americans routinely lose track of what they’re actually paying for. A C+R Research study from 2022 asked people to guess their monthly subscription spending. The average guess: $86. When the same people itemised every recurring charge, the real number came to $219, more than double.

By most accounts, those payments increasingly move through recurring card transactions rather than the direct debits that once funded most household bills. Regulators have paid far less attention to that shift than to the shift in habit that produced it. Underneath, the payment architecture has moved only in patches, mostly where regulators have pushed hardest, even as subscriptions have come to dominate how people spend.

And that lack of regulatory attention shows. Anyone who has tried to cancel one of these services knows the pattern. A subscriber cancels through the provider’s website, gets a confirmation email, assumes it’s done. A month later, the charge shows up anyway. Call the bank, and there’s nothing it can do:  the merchant controls the payment, not the bank. 

That’s because the subscription is just the trigger. What it actually exposes is a payments problem older than streaming and software subscriptions: once a recurring payment exists, who actually controls it?

A Tale of Two Rails

Two payment methods look identical to a customer, but they were built through entirely different histories, and that past controls the present. A direct debit is, at bottom, an instruction from a customer to their own bank, and because it runs directly between the two of them, the customer keeps the power to withdraw it. That right didn’t happen by accident, either. In most jurisdictions, banking regulation established early on that a bank has to act on an instruction to stop a recurring payment, no matter what the merchant thinks.

A recurring card payment looks similar on the surface, but it grew up inside the private rules Visa and Mastercard write for their own networks, rules built for one-off purchases, not indefinite monthly billing. Card payments went on to become the dominant way people fund subscriptions, and nobody ever circled back to extend an equivalent right to them. 

Can’t Stop, Won’t Stop

Banks aren’t legally barred from helping a customer stop a recurring card payment. Network rules don’t explicitly forbid it either. But at the same time consumers lack the clear right they already have with direct debits, one that obliges a bank to act on a plain instruction. Without it, banks generally can’t offer the same bank-level cancellation process that exists for direct debits, and to a customer, the result usually looks a lot like refusal.

For years, the industry had a simple answer for why banks couldn’t do this. The infrastructure didn’t exist. That excuse has run out. Mastercard has offered banks subscription-management tools since 2023, letting them show customers their recurring card payment and manage them right there in the banking app. Visa has gone further. Since April 2026, its own rules have required European card issuers to offer the same thing. Between them, these two moves answer a question regulators used to treat as genuinely open: can banks extend to card payments the same control they already give direct debits? The evidence says yes. The technology exists. The question is no longer whether banks can do it, but why so few are.

Other jurisdictions show the gap can be closed without much trouble. Take the United Kingdom. After years of complaints about payday lenders and gym memberships nobody could escape, the Financial Conduct Authority ruled in 2013 that banks have to treat a card-payment cancellation instruction, much like a direct-debit one. The bank acts on it. The merchant doesn’t get a say. That didn't strip merchants of their right to chase money genuinely owed; it just separated stopping a payment from resolving a dispute. The European Union has moved in a similar direction, giving consumers a clearer right to withdraw consent for recurring payments and requiring that cancelling be no harder than signing up in the first place.

Slow Followers

Then there’s the United States, which shows what happens without an equivalent right. Americans can cancel a recurring debit from a bank account under a clear statutory right; nothing comparable protects recurring card payments. Regulators tried fixing the problem from the merchant’s side instead, finalising a rule that would have required cancellation to be as simple as signing up. In 2025, the Eighth Circuit Court of Appeals struck it down on procedural grounds before it ever took effect. Which says something: a rule aimed only at merchant conduct can be undone by a single court decision, while a right built into who controls the payment is much harder to unwind.

Australia is now travelling a version of that same road. New legislation banning manipulative cancellation design has passed into law and takes effect from mid-2027. It’s a genuine improvement, but it only reaches the interface, not the payment behind it. A subscriber could comply with the new law to the letter and still get charged again the next month, because Australian customers do not have the same clear right to instruct their bank to stop the payment that UK customers do. And that gap matters most for exactly the subscriptions least likely to behave:  offshore operators domestic regulators struggle to reach, with little reason to comply with a law an ocean away.

Rules on merchant conduct handle one half of this. Rights built into payment infrastructure handle the other. Together, the job actually gets done; separately, neither one is enough. Australia has the first half now. So, largely, does the United States. Neither has the second, and that’s exactly why both remain incomplete.

Consumers have every reason to want their bank’s help managing recurring payments, and the technology to provide it increasingly exists. The UK has already answered the legal question for card payments. What’s still unresolved is whether the United States, Australia, and the many jurisdictions like them will do the same.

The real question is no longer whether banks can give consumers control over recurring card payments. It’s whether the law should require them to.

The opinions shared in this article are the author’s own and do not reflect the views of any organization they are affiliated with.

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