While recurring and account on file payments both involve storing payment details for future use, they serve different purposes and have distinct behaviors.

Recurring payments

These are scheduled, automatic payments that happen at regular intervals, like subscriptions.

Characteristics:

• Fixed interval: Daily, monthly, annually, etc.
• Same merchant: Always initiated by the same business
• Consumer consented: The consumer explicitly agrees to be charged on a schedule
• Initial transaction usually authenticated (e.g., with 3D Secure)
• Subsequent charges are typically merchant-initiated, without consumer interaction

Examples: Streaming services, gym memberships, meal kit deliveries

Account-on-file

This is a broader term meaning the consumer's payment credentials are securely stored for future use, but not necessarily on a schedule.

Characteristics:

• Can be used for unscheduled future payments
• May be initiated by either the consumer (CIT) or the merchant (MIT)
• May require authentication depending on the use case
• Includes one-click checkouts, top-ups, add-on purchases, or variable billing

Examples: Ride-hailing service storing your card for future rides, one-click purchases, consumers returning to re-purchase a service

Payment agreements

We recommend using payment agreements when integrating recurring payments, as they are required by some payment methods. Learn more payment agreements.

Network transaction identifier

The Network Transaction Identifier (NTI) is a unique code assigned by a card network (like Visa, Mastercard, American Express, etc.) to a specific payment as it travels through their systems. It serves several crucial purposes:

Unique identification: It ensures that each payment processed by the network has a distinct identifier, preventing confusion or duplication.

Transaction tracking: The network and other parties involved (issuing bank, acquiring bank, payment processor) use this ID to track the progress and status of the payment in real-time.

Reconciliation: It helps in matching and verifying payment records between different entities in the payment ecosystem.

Disputes: In case of a dispute, the network transaction identifier is essential for locating the specific payment and investigating the issue.

Recurring payments: For subsequent recurring payments, the NTI from the initial consumer-initiated transaction (CIT) is often a mandatory or highly recommended field. It establishes the link back to the original agreement and authorization for the recurring payments.

The schemeAuthorizationReference field in each authorization object represents the Network Transaction Identifier (NTI) returned by the payment scheme.

//... 
"authorizations": [
    {
      "id": "authz_x1lXf9uDGuN2IUqs33226",
      "amount": 2000,
      "status": "AUTHORIZED",
      "schemeAuthorizationReference": "MC1234567890ABCDE",
      "createdAt": "2025-05-01T15:21:35.276Z",
      "updatedAt": "2025-05-01T15:21:35.276Z"
    }
  ]
//...

When submitting subsequent recurring payments, the NTI from the initial consumer-initiated transaction can be provided in the payment charge object initialSchemeAuthorizationReference.

{
  "paymentMethod": "CARD",
  "initiator": "MERCHANT",
  "initialSchemeAuthorizationReference": "MC1234567890ABCDE",
  "instrumentId": "instr_KMkZAlNzIhaXD1il7DD72",
  "amount": {
    "value": 1000,
    "currency": "BRL"
  },
  "consumer": {
    "name": "John Smith",
    "country": "BR"
  }
}

Using payment agreements?

When using payment agreements, PPRO automatically persists the schemeAuthorizationReference obtained during the first payment charge and re-submits it to the payment scheme for all subsequent recurring transactions associated with that agreement.

Already have an NTI?

If the initial consumer-initiated transaction (CIT) has already occurred, the initialSchemeAuthorizationReference can be included with the create payment agreement request.