Automatic payments

What are automatic payments?

Automatic payments are pre-authorized transactions that allow a business to charge a customer’s saved payment method on a set schedule. This means customers don’t have to manually approve each transaction, the payment is processed automatically based on agreed terms.

The automatic payments are all about convenience and consistency. For customers, it ensures they never miss a payment. For businesses, it ensures steady cash flow and reduces the chances of late or failed payments. It’s commonly used for subscriptions, utility bills, loans, and memberships.

How does automatic payment work?

Here’s how automatic payments work:

• A customer provides their payment details and agrees to recurring billing terms.
• The business stores this securely and charges the customer at each billing interval.
• The transaction is processed without needing further customer action.
• Notifications are often sent to confirm successful payments.

Are automatic payments a good idea?

Yes, when managed responsibly. Automatic payments help avoid missed due dates and keep subscriptions running smoothly. However, customers should regularly review their subscriptions and bank statements to ensure they’re not paying for unwanted services.

Example of automatic payments in ecommerce

A customer signs up for a monthly meal kit subscription. Every month, his/her card is automatically charged, and their meals are delivered, no extra steps needed.

Driftcharge Tip

Use automatic payments to simplify your billing process. Driftcharge securely handles recurring payments and ensures your customers stay subscribed without friction.

Ganesh Pawar

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Ganesh Pawar is the founder of Driftcharge, a subscription management app designed to help Shopify merchants streamline and scale their subscription businesses. With a deep focus on solving real-world pain points—like legacy account page support, flexible subscription options, and advanced analytics—Ganesh is passionate about building tools that drive growth and retention.