Payments glossary
Recurring payments
Recurring payments are charges collected automatically on a schedule under the customer's standing authority - subscriptions, instalments, memberships. Online they typically run on a tokenised card-on-file, with the merchant initiating each charge without the customer present.
How recurring card payments work
The first payment is customer-initiated: the customer is present, enters or selects their card, and authenticates with 3DS2. At that point the card is tokenised and stored, and the customer's agreement to future charges is recorded. Every subsequent collection is a merchant-initiated transaction - the merchant charges the stored token on schedule, flagging it to the card schemes as part of the established agreement so issuers treat it correctly without asking an absent customer to authenticate.
Keeping recurring revenue alive
Most subscription churn is involuntary: cards expire, get reissued after fraud, or hit their limit on collection day. The defences are practical - retry logic timed sensibly (a R199.00 collection that fails at month-end often succeeds a few days later), token updates when issuers replace card details, and honest dunning messages that let customers fix a failed payment before losing service. Measuring recovery rate matters as much as measuring sign-ups.
Recurring options in South Africa
Card-on-file recurring suits digital services and anything sold on subscription; DebiCheck-authenticated debit orders serve contractual bank-account collections such as insurance premiums. LekkaPay supports tokenised recurring card payments as a live capability, with the initial authentication and subsequent merchant-initiated charges handled by the platform.
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