Not all customers are happy to set up a Direct Debit, so this allows you to take recurring card payments that vary in frequency and amount. Making it ‘easier’ for customers to make payments can be an effective way to boost your business.ĭirect Debit and CPA (Continuous Payment Authority) both make regular and recurring transactions simple. If your goal and purpose is to grow your customer base, improve loyalty, increase conversion, then having Card Payment as an alternative for your customers will prove extremely beneficial. It is true, there are pros and cons for each of these payment methods and ultimately, if your sole purpose is just to keep costs down – Direct Debit will win over. Why do some companies like Netflix, Xbox Live and Amazon Prime only offer continuous card payments? Direct Debit means that you are taking payment from a customer’s bank account, whereas CPAs mean that you are taking payment from their credit or debit card. Recurring card payments (also called a continuous payment authority (CPA) work in a very similar way, except there is a slight difference in where you are collecting the payment. Payments and frequency of payments can vary, but advance notice must be given prior to any changes in the amount debited. This is an instruction from your customer to their bank, which gives express authority and permission to collect money directly from their bank account whenever their payment is due. Let’s examine each method in a bit more detail. However, there is another school of thought: How about offering the two payment methods alongside each other? Recurring Card Payments are expensive and if a customer has their card lost/stolen, it expires or they change their bank – this will result in pain and lost revenue.Direct Debit is a tried and tested payment method, it’s low cost and easy to set up.In the world of recurring payments, subscriptions, monthly premiums and collections there are generally two schools of thought:

Direct debit credit card