What is a CPA Payment?

How to accept credit card payments in the US

A continuous payment authority (CPA) allows merchants to automatically take regular payments from a customer’s credit or debit card with the customer’s authorisation.

While there are other online payment methods, CPAs are fast, flexible, and convenient for both parties. They’re easy to set up for a company and are commonly used for subscriptions, utilities, and memberships.

This guide goes over CPA payments in detail, including what they are, how they work, and when they’re useful.

What Is a Continuous Payment Authority?

A CPA is an automatic, regular payment method where a customer gives a company authorisation to charge their debit or credit card when a payment is due. It’s used to pay for a wide range of services and products including subscriptions, utilities, memberships, rent, or charity donations.

They’re popular for businesses and customers alike as they work quickly, are easy to set up, and are flexible if payment terms change. However, the fees for CPAs are higher than other automatic payment methods, and there’s a chance of failed payments.

Costs for CPA payments vary depending on your provider, but are generally around 1.5% to 3.5% per transaction. Some may charge a small flat fee along with or instead of the percentage, as well.

How Does a Continuous Payment Authority Work?

CPA payments work by automatically taking money from a customer’s credit or debit card whenever a payment needs to be made. They streamline the payment process for everyone involved and are straightforward to set up.

There are a few steps to take before you can start accepting CPA payments.

Ensure You Can Accept Card Payments

First, you need to make sure your business can accept card payments. This requires that you have a merchant account and a payment gateway.

A merchant account is where customer funds go before they’re authorised to go to your business bank account. It’s specifically used to accept electronic customer payments, and there are many types including retail, mobile, and internet merchant accounts.

Meanwhile, payment gateways (such as takepayments and Worldpay) are responsible for passing credit card information from merchants to both your bank and the customer’s bank. They also get the customer’s funds into your merchant account.

You can set up this system of a merchant account/payment gateway yourself, or choose to work with a payment facilitator who does the heavy lifting for you. If you want to do it yourself, you need to open a merchant account with a bank and choose a payment gateway provider to work with.

If you work with a payment facilitator (such as Square or Stripe), it will take care of the merchant account and payment gateway for you. These providers offer a built-in gateway and an aggregated merchant account that batches your transactions with other merchants, so you don’t need your own.

Gather Card Details and Get Authorisation

Once you have a system in place to accept these payments, you have to collect your customer’s card details. This includes the card number, as well as the security code and expiry date. You’ll also need their authorisation to charge the card.

Companies can take a standard one-time payment from a customer first, and then use that information to schedule future payments. Or they can collect card information in a secure online form.

Set up and Schedule Recurring Payments

Using the card details your business collects and stores, you can set up a recurring payment on a specific billing date. Since CPAs are flexible, you can also change the terms if needed.

When Are Continuous Payment Authorities Useful?

There are several situations where using CPA payments is useful for your company.

When You Want a Streamlined Way to Collect Regular Payments

If you’re getting a regular monthly payment from customers for your product or service, it makes sense for everyone to automate this process. Instead of you having to send an invoice and wait for customers to pay, everything happens automatically without any extra effort from either side.

In addition, customers won’t need to worry about missing a payment or accidentally sending the wrong amount.

When You Want Fast Payment

If you want to get paid as quickly as possible, CPA payments make a lot of sense. They work faster and can get your business paid quicker than methods like direct debit.

For example, credit card payments are processed instantly and often completed within a day, though the exact amount varies depending on your provider. In comparison, direct debits take three days.

Check out our guide on credit cards vs. direct debit for a more detailed comparison between these two popular payment methods.

When You Want to Make Accurate Projections

CPA payments are automatic, so you don’t have to worry about late or missed payments interfering with projections. Having accurate projections and predictable cash flow helps you plan for the future, set reasonable goals, and invest more wisely.

How Safe Are Continuous Payment Authorities?

CPAs are generally safe for businesses because they automate payments to ensure customers pay on time and in full. They’re safe for customers as companies must abide by several rules when taking CPA payments.

Card transactions themselves are secure as they normally have fraud protection, transaction limits, alerts, and liability protection in place. Information sent during a transaction is generally encrypted, too.


That being said, there are some risks when accepting CPA payments. The biggest risk is failed payments. If customer cards expire, get cancelled, or hit spending limits, the automatic payments can fail.

This is annoying and takes up time as you chase customers down to pay. You may be charged for failed payments, too.

Another risk is cyber crime. Credit card data is like gold for hackers and cybercriminals, and if you store a lot of it, you could be a potential victim. A data breach could ruin your credibility as a business and may come with hefty penalties or fines.

Mitigating Risks

Thankfully, there are some ways to diminish these risks. While you can’t prevent failed payments from happening, you can ensure you have a plan in place to deal with them. This could involve retrying the payment, automatically notifying the customer, or immediately pausing the service until a payment is made.

You can also send customers reminders to update payment information when they get a new card to reduce the chances of failed payments.

When it comes to protecting customer card information, make sure you’re aware of the PCI compliance requirements. This includes encrypting data, testing security measures frequently, restricting access to cardholder data, and more.

Ensure your team use strong passwords and train them well on how to identify and avoid scams, too.


A CPA payment is an automatic payment method that allows a company to charge a customer’s credit or debit card when a payment is due, as long as they’ve been authorised. They’re commonly used to pay for subscription services, memberships, utilities, rent, or charity donations.

They work incredibly fast and are flexible if the payment amount of frequency changes. While they cost more than other automatic payment methods and have a potential for failed payments, they’re still one of the most convenient and popular payment methods for companies and customers alike.


How to Cancel a CPA Payment?
To cancel a CPA payment, a customer has to reach out to the company or card issuer and request the cancellation. If a customer cancels a CPA with their card provider, they don’t have to notify the company, but it’s generally a good thing to do.
Is a CPA Payment the Same as Direct Debit?
While both a CPA payment and direct debit are automatic ways to take regular payments, the way they operate is different. CPAs take payments from a customer’s debit or credit card, and direct debits take funds from their bank account.
What’s the Cost of CPA Payments for Businesses?
The cost of a CPA payment varies depending on a business’s bank or payment provider but is normally around 1.5% to 3.5% per transaction. Some may also charge a small flat fee instead of, or in addition to, the percentage. It generally costs more than other methods like direct debits and standing orders.
Written by:
Eamonn is an experienced B2B writer and content manager, having managed and grown several B2B business blogs in the fitness and hospitality space.