A Simple FTC Compliance Checklist

In light of the FTC’s recent Click to Cancel ruling, businesses offering subscriptions must ensure their cancellation processes are compliant, straightforward, and easy for consumers. At Churnkey, our mission is to make compliance effortless for businesses, helping you align with the new regulations while improving the overall customer experience. This checklist is designed to guide you through the key steps needed to stay compliant with the FTC’s requirements, so you can focus on growing your business without worrying about regulatory challenges.

Simple Cancellation Checklist

1. Ease of Use

☐ Simple Mechanism Required for Cancellation: Ensure that a simple mechanism is provided for consumers to cancel their negative option (auto renewing recurring charges) feature and stop any recurring charges immediately. This mechanism should not create unnecessary barriers or complications.

☐ At Least as Easy as Consent: The cancellation process must be at least as easy to use as the mechanism by which the consumer initially consented to the negative option (auto renewing recurring charges) feature

2. Medium of Cancellation

☐ Same Medium as Consent: The cancellation mechanism must be available through the same medium the consumer used to consent (e.g., online, via phone, in person).

☐ Clear Accessibility: The cancellation option must be easy to find when the consumer decides to cancel. It should not be buried in terms and conditions or hidden behind other screens.

3. No Requirement for Representative Interaction

☐ No Mandatory Interaction: Consumers should not be required to interact with a live or virtual representative (e.g., chatbot) to cancel if they did not do so to consent to the negative option feature.

4. Telephone Cancellation

☐ Prompt Effectuation: For telephone cancellations, ensure all calls are answered promptly during normal business hours and are not more costly than the call used to consent to the negative option.

☐ Clear Communication: Provide a clear telephone number for cancellations that is easily accessible.

5. In-Person Cancellation

☐ Offer In-Person Cancellation: If consent was obtained in person, ensure that cancellation is also available in a similar manner.

☐ Alternative Mechanism: Additionally, provide an alternate cancellation mechanism through an interactive electronic medium or by phone, which meets all relevant requirements.

Additional Notes

• Consider gathering feedback from customers regarding their cancellation experience to continuously improve the process.
• Regularly review and update the cancellation mechanism to ensure it remains compliant with evolving regulations and best practices.

Conclusion

Implementing a "Simple Cancellation Mechanism" is crucial for maintaining customer satisfaction and compliance with regulatory requirements. By following this checklist, businesses can create an effective cancellation process that enhances customer trust and reduces potential friction during the cancellation experience. With Churnkey, achieving compliance with each of these items becomes effortless. Our platform is designed to ensure your business meets all regulatory standards while providing a seamless and positive experience for your customers.