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Legal, structural barriers exist to adopting auto-renewal

Automatic renewal can boost retention rates, but groups must first contend with state laws and their own dues structures


March 1, 2019
By Walt Williams

Automatic renewal is a common practice for many subscription services but a large number of associations have yet to incorporate it into their membership models. Experts say there are good reasons groups should adopt auto-renewal, although there are possible legal and structural hurdles they must consider first.

An annual survey of associations by Marketing General Inc. found a growing number of groups are automating membership renewals. Only 22 percent of associations reported having automatic credit card renewals in 2010, but that figure steadily increased over the years until it hit 45 percent among individual membership organizations surveyed in 2018. At the same time, the proportion of associations using automatic electronic fund transfers increased from 10 percent to 17 percent.