There are two types of Regular Payments – Recurring and Instalment. Both are automated payments that are debited from your credit or debit card at predetermined intervals. Both are essentially an agreement between you and a company (which you pre-authorise to bill your card account).
Recurring Payments and Instalment Payments differences
A Recurring Payment is when a cardholder authorises a merchant to bill their account on a recurring basis (such as monthly or quarterly) for an ongoing service provided by that merchant. The amount of each payment may be the same or may fluctuate (eg. you may ask your gym to charge your membership fee to your credit card each month).
An Instalment Payment is a single purchase made upfront but charged to you over subsequent multiple periods (eg. you buy a new television are then billed by the merchant over several subsequent periods).
Your responsibilities and obligations
If your account details change, it's your responsibility to let any merchants you have a Regular Payment with, know. You must also provide the merchant with valid credit or debit card expiry dates.
You should keep copies of all the Regular Payment agreements you enter into. We also recommend you keep copies of any notifications you've sent to merchants asking them to change your account details.
How to cancel or amend your Regular Payments
The best way to cancel a Regular Payment (or have it billed to a different card account) is in writing. We recommend you keep a copy of all notifications just in case the merchant doesn’t follow your request. You may then be able to dispute the charges.
Your rights and remedies
If you believe you've been incorrectly charged a Regular Payment, and can provide your bank with a copy of the notification you sent to the merchant, you may be able to dispute the charges. Contact your bank for more information.
What are the benefits of setting up a Regular Payment?
There are many benefits for cardholders who set up Regular Payments:
- They ensure timely payments to the merchant.
- They save you time as the payment is processed automatically.
- They can save you money as you don't have to pay for cheques, money transfers or postage.