What is a recurring payment?

A recurring payment is an automated transaction that is made periodically to cover a contracted service or product. This means that you are automatically charged at regular intervals (e.g. monthly, quarterly or annually) without having to intervene each time. 

Such payments are pre-authorised and are usually linked to a debit or credit card, or also to a bank account. It is a solution that can be very practical, especially for those services that you use constantly.

Differences between recurring and one-off payments

The main difference between a recurring payment and a one-off payment is automation. While one-off payments require your authorisation or intervention each time, recurring payments are executed automatically until you decide to cancel them. 

A one-off payment is ideal for one-off purchases, such as an appliance, clothing or a soft drink, while recurring payments are better suited to ongoing services, such as a membership or a bill. 

Examples of common recurring payments

In Spain, recurring payments are commonplace in different areas of our daily lives. Some of the most common are: 

1. Digital subscriptions: Services such as digital video streaming platforms, cloud storage or entertainment applications. 
2. Public or private services: Direct debits for electricity, water, gas or medical insurance bills, among other things. 
3. Gyms and academies: Monthly fees that are automatically charged. 
4. Telephone and Internet plans: Telecommunications companies use this system to charge the contracted tariffs. 
5. Memberships and professional software: Many digital tools and programmes work on subscription models. 

Advantages of recurring payments

1. Comfort: You don’t have to remember dates or worry about forgetting. 
2. Saving time: By automating the process, you avoid having to travel or make manual transfers. 
3. Financial organisation: As they are regular payments, they help you to better plan your expenses. 
4. Continuity of service: You will never miss out on important services because you didn’t pay on time. 

These benefits make our day-to-day lives easier, but we need to share our bank details only with trusted companies to avoid fraud. As well as keeping a regular check on our account to avoid increases in our fees or to avoid unwanted char

Security recommendations for recurring payments

While recurring payments are very useful, it is important to manage them with caution. Here are some recommendations: 

• Check your account: Do this periodically to ensure that all charges are correct. 
• Cancel services you do not use: If you find that you are still paying for something unnecessary, contact the provider and cancel the subscription. 
• Use secure payment methods: Only link your recurring payments to cards or accounts that you can easily manage. 
• Be wary of unrecognised charges: If you detect a strange charge, act immediately and contact your bank and the company responsible.