Industry · Subscriptions and SaaS
Subscription and SaaS chargebacks: renewals, trials and “I cancelled”
Recurring billing businesses mostly face “cancelled but still charged,” surprise renewals, free trials that converted and charges nobody recognizes. Visa’s rules require a simple cancel path and a reminder before a trial ends, and since April 2026 a cancellation made after the charge doesn’t support a cancelled-recurring dispute.
Key takeaways
- “I cancelled” is the main event. The cancellation timestamp usually decides the case.
- Visa sets recurring rules. Simple cancellation, online if they signed up online, and a reminder before a trial converts.
- April 2026 change. A cancellation after the charge no longer supports a Visa 13.2 dispute.
- Usage counts. Customers who keep logging in after the charge rarely mean “I cancelled.”
Why subscriptions get disputed
Subscriptions charge people who aren’t thinking about you. A renewal lands, a trial converts, a price changes, and the customer reaches for the dispute button instead of the cancel button. The disputes we see most:
- Cancelled but still charged. The customer says they cancelled, or thinks they did.
- Free trial converted. “I never agreed to pay.”
- Annual renewal surprise. A big charge a year after sign-up.
- Unrecognized charge. The billing name doesn’t match the product, or a corporate card holder doesn’t know the vendor.
- Wrong amount or credit not given. Seat true-ups, price changes or a promised downgrade credit.
Which reason codes subscriptions see
Most land in cancelled recurring: Visa 13.2, Mastercard 4841 (now filed under 4853), Amex C28 and Discover AP. The second family is fraud or unrecognized: Visa 10.4 and Mastercard 4837. Billing errors come in as incorrect amount (Visa 12.5) and missing credits as credit not processed (Visa 13.6).
The rules that decide recurring disputes
Visa’s rules for storing a card and charging it again are public. Before you store the card, the customer must give express informed consent to terms that include the amount or how it’s set, the timing, how the card will be used, and the length of any trial or promo. For recurring charges, you must:
- Offer a simple cancellation procedure, and an online one if the customer signed up online.
- Say the fixed dates or intervals of the charges.
- Notify the customer at least 7 days before billing when a trial, intro offer or promotional period ends, with the amount, the date and a link or other easy way to cancel.
On the dispute side, Visa limits a 13.2 dispute to the unused portion of the service. And for disputes processed on or after 18 April 2026, a 13.2 dispute is invalid when the customer cancelled after the date of the charge.
Check the time zone before you fight. A cancellation at 11 p.m. Pacific is already the next day in UTC. If your billing system and your cancel log disagree on the date, sort that out before you contest, not after the bank does.
US law points the same way. The Restore Online Shoppers’ Confidence Act requires online subscription sellers to disclose material terms before taking billing details, get express informed consent and provide a simple way to stop the charges. Many states add renewal reminders and online cancellation rules.
Deadlines to watch
Visa gives the bank 120 days from the processing date for a cancelled recurring dispute, and each charge has its own clock, so one unhappy customer can dispute several months together. Your response window is the date on your notice, usually 7 to 21 days.
Dispute Daddy builds this for you
The proof that matters: the terms the customer accepted, the reminders you sent, the cancellation date and their usage after the charge. Dispute Daddy works from the exports you upload, builds the response around the reason the customer gave, and keeps the due date in view. You review, approve and submit. A flat $99 a month. See pricing.
