Visa and Mastercard and FTC…Oh My!

Visa, Mastercard and the Federal Trade Commission are working out a new series of regulations to protect consumers and businesses from fraudulent online business transactions. To date, there are already hundreds of internet businesses which have lost their merchant accounts in the past couple weeks.

There are always pros and cons in making regulations for a few which affect the many, and this situation is no different.

On the plus side, internet consumers will be protected from unethical internet business practices such as “Negative option billing“. Additionally, Visa and Mastercard will be knocking out all activities which are damaging to their reputation. We, as consumers AND business owners, count on Visa and Mastercard all the time. And we need to be able to count on them.

On the minus side, their regulations COULD affect businesses which do NOT engage in unethical activities, but which contain some of the criteria/characteristics which are similar to those of the scammers. For example, many membership sites offer free introductory services before you start getting billed monthly. It’s so common, it’s basically how it’s always done. But the shady businesses do this too. So if the new rules cancel this activity, millions of completely ethical businesses will not be able to do business.

It’s impossible to say exactly how this is going to play out, but one thing is for SURE: If you use negative option billing, you better make it REALLY obvious to the customer that that’s what you’re doing, so there is NO MISTAKE, and NO chance that your customer doesn’t know. And if you’re an unethical business intentionally withholding your activities from your customers…well, you’ll be gone soon. But it’s never too late to make a new start and try running a legitimate business and actually being good to your customers.

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