Recurring payments banks process reveal a data blind spot
Tapix executive Martin Korbelar says banks need transaction-level data to spot automated charges as subscription spending and disputes rise.
By Rafael Ortiz · Fintech Correspondent
· 3 min read
Recurring payments banks handle through current accounts and cards have become a major operational and customer-service issue, according to Martin Korbelar, CEE sales director at Tapix by Dateio. In a Finextra opinion post, Korbelar said many banks still lack dependable tools to identify automated charges at the transaction level, leaving customers with limited visibility over what is being paid, how often and to which merchant.
Korbelar linked the problem to the spread of automated billing beyond media and entertainment. Services such as cloud storage, fitness memberships, insurance, vehicle finance, grocery delivery and business software now draw regular payments from customer accounts, creating a larger flow of repeated transactions for banks to classify and explain.
An industry estimate cited by Korbelar put the global recurring payments market at about $182 billion in 2025, rising to just under $200 billion in 2026, with high single-digit annual growth expected through the end of the decade. He said the exact estimates differ by methodology, but the direction of growth is clear.
Why can't banks see recurring payments?
Banks can struggle because payment records often show incomplete or inconsistent merchant descriptors, while the same merchant may process both one-off and repeat charges. Korbelar said reliable detection requires analysis of individual transactions, including amount, timing and frequency, rather than broad merchant-level labelling.
That distinction matters because a merchant name alone can mislead. A technology platform may sell a one-time app purchase and also bill for recurring storage. A transport operator may take payment for a single trip as well as a monthly pass. Korbelar said tagging all transactions from such merchants as subscriptions creates false positives, while ignoring them risks missing genuine recurring commitments.
A recurring payment is any authorised automated payment taken on a schedule, such as weekly, monthly or yearly. A subscription is a narrower category: a repeated charge for continued access to a service or product, such as streaming, software or digital content.
The customer impact can be direct. If a bank app cannot help stop a single unwanted recurring card payment, Korbelar said customers may have to freeze or cancel the card, disrupting other legitimate card-on-file arrangements. For banks, that can weaken their position as the default payment method for customers' regular spending.
Regulators are also focused on the issue. UK government analysis cited in the Finextra post estimated that, among roughly 155 million active subscriptions, close to 10 million were unwanted and accounted for about £1.6 billion in annual consumer spending. The UK Digital Markets, Competition and Consumers Act introduces rules intended to make sign-up terms clearer, require renewal reminders and simplify cancellation.
What data do banks need?
Korbelar said effective recurring-payment management depends on attaching clear attributes to each relevant transaction: merchant name, category, billing frequency, expected next payment date, expected amount, renewal status and changes in payment size. A price increase can then be detected before it becomes a larger annual cost for the customer.
He said pattern-based detection can also find merchants that conventional merchant-category methods miss, including local transport, delivery and grocery services. Annual subscriptions may appear infrequently in account data, but Korbelar said they can account for a disproportionate share of total subscription spending.
Disputes add another cost. A Forrester study commissioned by Minna Technologies and cited by Korbelar surveyed senior bankers in the US, UK and Australia and put subscription-related disputes at an average of about $136 million a year per bank, with larger institutions reporting higher costs. Korbelar said some disputes begin when customers cannot recognise a charge and report it as suspicious.
Digital banks have started to address the problem through consolidated recurring-payment views, alerts before charges arrive, low-balance warnings and merchant-specific blocking tools, according to Korbelar. He said the same data layer can extend to housing payments, transport passes, toll tags and recurring business vendor payments, turning raw account activity into information customers and banks can use.
This story draws on original reporting from Finextra Research.
