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Payday loans: Cancel recurring payments or continuous payment authority

When you give your credit or debit card details to a company and let them take regular payments from your account, it is known as a continuous payment authority (CPA). Payday loans are often run this way.

A CPA can also be called:

  • Recurring transactions, or
  • Regular card payments

What is a continuous payment authority?

A CPA is a type of regular payment made using your debit or credit card. It is set up when you give your card details to a company so they can take payments from you.

There can be confusion around how these payments work. And about what rights you have compared to other regular payments such as:

  • Direct Debits
  • Standing orders

Continuous payment authority is a popular method of payment for:

CPA is different to Direct Debit. Payments made by CPA are not covered by the Direct Debit guarantee, but the law offers you similar protections. For example, you can get a refund of any money taken without your permission.

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How do I stop recurring payments for loans?

You can cancel a CPA by contacting your bank or the company taking the payment.

When you cancel a CPA it means:

  • You are telling the people you owe they do not have permission to use your card details in the future
  • If any more payments are taken after this, they would be ‘unauthorised’

The deadline for stopping a CPA payment is: Before close of business on the working day before the payment date.

This means to cancel a payment:

  • If your payment was due to leave on a Friday: You need to get in touch with your creditor or bank before they close on Thursday
  • If your payment was due to leave on a Monday: You need to get in touch with your creditor or bank before they close on the Friday before

If you miss this deadline, you will not be able to stop the payment being taken.

Use our template letter to cancel a CPA

To cancel a CPA you will need to contact the company taking the payment, or your bank to cancel your recurring payment. This can be done:

  • Over the phone
  • By email
  • In a bank branch
  • In writing

If the payment is due to be taken in the next few days, we recommend cancelling it by phone.

We have a continuous payment authority template letter [PDF] you can use to do this. Download it and fill in your details.

If you call your creditor, we recommend you keep a note of:

  • The time and date of the phone call
  • The name of the person you have spoken to about it

If you contact your bank to stop a CPA, you should contact the company as well to let them know. You will still owe the money for the payments you have agreed to make.

If you are finding it hard to make the agreed payments you should get in touch with the company to let them know.

Arranging a refund of an unauthorised payment

If you have cancelled a CPA before the deadline and the payment is still taken, this is known as an ‘unauthorised’ payment.

If this happens, you should get in touch with your bank to let them know. They should arrange a refund of:

  • The payment, and
  • Any related charges you may have received due to the money leaving your account

Cancelling recurring payments to a payday loan

If you cannot afford to make the payments you should be able to cancel them. If your creditor refuses to:

  • Refund the payment, or
  • Cancel your CPA

You can make a complaint.

Missing payments towards a payday loan may be the sign of a debt problem. If you need help, take two minutes to answer a few simple questions, so we can understand the best way to support you.