Autopay

Autopay, or automatic payment, is a service that authorizes a payee to withdraw funds from a payer’s bank account or charge a stored payment method on a scheduled basis. It is used for recurring obligations such as utilities, subscription services, loan repayments, insurance premiums and membership fees. Authorization may take the form of a signed mandate, online consent, or retention of card details for repeat billing.

Implementations vary: direct debit systems (ACH in the United States, Direct Debit in the UK), standing orders, card-on-file recurring charges and payment tokens are common methods. Autopay arrangements may be for fixed amounts (e.g., rent) or variable amounts (e.g., utility bills), and can be scheduled on specific dates or triggered by invoice issuance.

Advantages include convenience, reduced risk of late payments, streamlined billing and improved cash flow predictability for payees. Drawbacks include potential overdrafts, loss of granular payment control, difficulty canceling improperly authorized charges and increased exposure to fraud or data breaches. Dispute and refund mechanisms depend on local regulations, bank policies and card network rules.

Service providers typically offer online management tools to view, pause or cancel autopay agreements. Consumers are advised to monitor statements and understand the authorization terms. Regulatory frameworks and consumer protections vary by jurisdiction, and businesses must balance ease of use with secure authorization, authentication and record-keeping practices.