Instacart FTC Settlement: $60M in Refunds for Shoppers

Instacart will pay $60 million in consumer refunds to settle allegations by the US Federal Trade Commission that the grocery delivery company deceived shoppers over its “free delivery” promises and its Instacart+ subscription program. The Instacart FTC settlement, announced by the commission in December, requires the company to end a range of practices the agency said misled consumers and raised the cost of grocery shopping.

Under the proposed order, consumers who were charged for Instacart+ memberships without their express informed consent will receive refunds, and Instacart will be barred from misrepresenting delivery costs, service fees, and refund guarantees. The proposed order remains pending approval by a district court judge, after which the FTC says it will release more information about the refund process.

What the FTC alleged

The FTC’s complaint, filed in federal court in San Francisco, accused Instacart of a pattern of deceptive tactics. According to the commission:

• False “free delivery” claims. Instacart advertised free delivery to consumers on early orders, but shoppers still had to pay a mandatory service fee to get their groceries delivered. The FTC said these fees added as much as 15 per cent to the order cost and were not clearly disclosed.
• Free trials rolled into paid memberships. Consumers who signed up for a free trial of Instacart+ — the company’s membership program, which offers $0 delivery fees on most orders for $99 a year or $9.99 a month — were automatically enrolled in paid subscriptions without clear disclosure that they would be charged when the trial ended. The FTC said hundreds of thousands of consumers were charged while receiving no membership benefits or refunds.
• A broken satisfaction guarantee. Instacart advertised a “100% satisfaction guarantee,” but customers who experienced late deliveries or poor service were typically offered only a small credit toward a future order rather than a refund, the agency said.
• Hidden refund options. The complaint alleged that in 2022 Instacart hid the refund option from self-service menus, steering consumers toward credits instead of refunds to their original form of payment.

“Instacart misled consumers by advertising free delivery services — and then charging consumers to have groceries delivered — and failing to disclose to consumers that signed up for a free trial that they would be automatically enrolled into its subscription program,” said Christopher Mufarrige, director of the FTC’s Bureau of Consumer Protection. “The FTC is focused on monitoring online delivery services to ensure that competitors are transparently competing on price and delivery terms.”

Instacart’s response

Instacart denied the FTC’s allegations of wrongdoing but said it reached the settlement to move forward and focus on its business. “Instacart is proud to offer a transparent, affordable, and consumer-friendly service. We provide straightforward marketing, transparent pricing and fees, clear terms, easy cancellation, and generous refund policies — all in full compliance with the law and exceeding industry norms,” the company said in a statement.

Going forward, the proposed order prohibits Instacart from automatically enrolling customers in paid memberships unless they opt in, and requires clear disclosure of subscription terms before any charge. The company will also face restrictions designed to ensure customers see accurate order totals.

Who may get a refund

According to the FTC and settlement administrators, eligible consumers may include:

• Shoppers who paid mandatory service fees on orders advertised as having “free delivery.”
• Consumers who were denied full refunds despite the company’s advertised satisfaction guarantee and received only partial credits or could not locate the refund option.
• Consumers who signed up for an Instacart+ free trial and were automatically charged for a paid subscription without clear, conspicuous disclosure of the terms.

The settlement administrator will determine each qualifying customer’s payment based on the number of eligible consumers identified, the amounts each person was charged, and administrative costs of distributing the refunds. The FTC said the payout is expected to reach hundreds of thousands of affected customers.

The Instacart FTC settlement in context

The Instacart case is part of a broader FTC crackdown on hidden fees in online food and grocery delivery. In December 2024, the agency secured a $25 million settlement with Grubhub over similar allegations that the platform misled consumers about the actual cost of delivery. Regulators have described hidden and misleading charges as a persistent industry-wide problem rather than an isolated practice.

Several states have also passed laws requiring delivery platforms to disclose fees more clearly and include mandatory charges in advertised prices, though those rules vary by state. The FTC has pushed for stronger national standards, arguing that inconsistent state protections leave gaps that let some platforms operate with minimal transparency.

For consumers, the takeaway is straightforward: review subscription charges, read trial terms carefully, and file a complaint with the FTC if a delivery platform’s checkout price does not match what was advertised.