Some merchants can get automatic credit card updates when your card is expired or replaced

Bob Yeager didn’t realize his credit card company alerts auto-pay merchants about changes with his card on file. (KOMO photo)

Bob Yeager cancelled his membership at the gym where he used to work out. He joined a different gym, and figured the automatic monthly payment to his old gym would stop.

“It was being auto deducted to a credit card that I knew was going to expire soon,” Yeager explained.

Because his credit card was expiring, Yeager says he wasn’t concerned.

“I thought, well, the payments are going to stop anyway. And I got my new card of course, because it automatically renewed with Visa,” he said.

But by the time the old gym processed Yeager’s cancellation, another monthly payment showed up on his new credit card.

“The charge showed up on my new card!” Yeager exclaimed. “And that’s the part that I was surprised by.”

Yeager discovered his old gym got his new credit card information from his credit card company.

All the major card companies do it. Visa calls its service the Visa Account Updater. At Mastercard, it’s the Automatic Billing Updater. American Express calls their service the Cardrefresher.

Automatic updates are promoted as a convenience, to prevent your recurring auto-payments from being declined because you forgot about a credit card change. It saves cardholders from dealing with late payments and delayed notifications when their card is declined. It saves merchants the costly hassle of tracking down cardholders to get updated card information so they can be paid.

“I can see the advantage to the consumer,” said Yeager. “The disadvantage in my mind, is that there’s no way I can get out of it.”

Yeager says his bank and credit card company both told him that if he wanted to opt-out of the automatic account updates, he would have to contact the businesses that have his card on file.

“I can’t stop it on the bank side,” he said.

Policies vary. A spokeswoman for American Express told me with their service, cardholders can contact Amex and cancel the…

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