Recurring transactions refer to a type of financial arrangement where a customer gives authorization for a regular payment to be automatically deducted from their account at specified intervals. These transactions are often used for subscription-based services, memberships, utility bills, loan payments, and other scenarios where payments need to be made on a consistent basis.
Recurring transactions provide convenience for customers, as they don’t need to manually make payments each time a bill or service charge is due. However, customers should carefully review the terms and conditions of any recurring payment arrangement and monitor their accounts for accuracy.
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Merchants and service providers benefit from recurring transactions by having a predictable cash flow and establishing ongoing relationships with customers. However, they also have a responsibility to manage these transactions ethically, provide clear cancellation procedures, and handle any customer disputes or issues that arise.
