In banking, the full form of CPA is Continuous Payment Authority. It is a type of payment authorization that allows a customer to authorize a merchant or service provider to collect payments automatically from their bank account on a recurring basis. This could involve subscription services, utility bills, loan repayments, or membership fees.

Purpose of CPA

The primary purpose of Continuous Payment Authority is to facilitate seamless, automated payments for services or goods over a specified period. This eliminates the need for customers to manually authorize each payment, offering a convenient and time-saving way to manage regular financial obligations.

How CPA Works

Once a CPA is set up, the merchant or service provider is authorized to take payments from the customer’s account on agreed dates. The customer typically provides their bank account or card details to initiate the process. The payments are automatically deducted without further intervention from the customer until the agreement is canceled or changed.

Advantages of CPA

• Convenience: CPA allows customers to make recurring payments without having to manually approve each transaction.
• Timeliness: Regular bills or subscription services are paid on time, reducing the risk of missed payments and late fees.
• Control: Customers can cancel or modify their CPA agreements with the service provider at any time, providing flexibility in managing their financial commitments.