What’s a recurring credit card authorization form?

Get the rundown on credit card authorization forms to decide if they’re a good option for you.

Merchants and businesses use recurring credit card authorization forms to charge for their goods and services without needing a customer to be present. A customer authorizes the vendor to make a one-time or recurring charge to their account by signing this form.

Gym memberships, subscriptions, monthly utility bills, regular loan payments, car loans, student loans, well, you can just about name it — they all use recurring credit card authorization forms.

Read on to learn more about how recurring credit card authorization forms work so you can make the right choices for your financial situation.

Recurring credit card authorization form tips.

• Read the fine print. Businesses can use recurring credit card authorization forms to lock customers into lengthy contracts with expensive contract-breaking stipulations. Make sure you understand the monthly payment terms, any minimum commitments, and any penalties for breaking the contract before you sign. Be sure to consult legal counsel should you have further questions.
• Understand free trials. If you’ve ever had to sign up for a free trial by inputting your credit or debit card information, you’ve likely agreed to a recurring authorization. While the trial might be free, you may have unintentionally subscribed to monthly payments if you don’t cancel in time. Be aware of how free trials work so that you can make the right financial decision for yourself.
• Budget accordingly. Keep and track all recurring transactions within your monthly budget. Those payment dates can sneak up on you if you're not paying close attention, so make sure you have enough money in your accounts to cover them monthly.

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