For years, innovation in payments has focused on what clients see and experience: new apps, digital wallets, tap-to-pay cards and ever faster checkout experiences.

But the real shift in payments today is happening in the infrastructure layer that allows banks and businesses to move money more intelligently, more securely and with greater flexibility.

Recurring payments are a good example of this. They’ve become central to modern business models, from media subscriptions and insurance premiums to utilities, SaaS platforms and membership services. Yet the mechanisms many businesses still rely on weren’t built for the way digital commerce works today.

Account-based recurring payments allow clients to authorise recurring transactions directly from their bank account, removing common payment failures like card expiry and fraud checks. Instead of relying on card networks, this model uses open banking infrastructure – like Capitec Pay – where clients approve payment mandates once in their banking app, then payments run automatically.

Card-based subscriptions, for instance, often fail for reasons unrelated to the client’s ability to pay. Cards expire. Limits change. Fraud checks intervene. When payments fail, businesses lose revenue and clients experience unnecessary disruption.

As subscription and usage-based models continue to expand, the payments infrastructure supporting them needs to evolve.

Infrastructure as the real innovation layer

In South Africa, much of that evolution is happening at the infrastructure level, through the platforms that connect banks, businesses and clients.

Pay@ operates in this layer. Founded in 2007, the company has built a payment network connecting billers and merchants across banks, retail partners, mobile platforms and digital channels through a single integration.

This kind of aggregation layer plays an important part in modernising payments. Instead of each bank or business building and maintaining complex integrations independently, a shared platform provides the transaction infrastructure that connects them, so payment innovation can happen faster.

For businesses, this means a single integration can support multiple transaction types, including real-time payments, digital billing and recurring transactions. For banks, it means they can introduce new payment capabilities without disrupting core systems.

The rise of account-based recurring payments

Account-based recurring payments, a notable development to emerge from this infrastructure approach, offer key advantages over traditional card-based methods:

No card expiry issues – payments never fail because a card has expired
Fewer failed transactions – no scheme-level fraud checks blocking legitimate recurring payments
Clearer client authorisation – clients approve the payment mandate once, inside their banking app, giving them full control and visibility

The model reflects a broader shift towards open banking and client-controlled payments.

How Capitec Pay enables recurring payments

A clear example of this model in action is the rollout of variable recurring payments (VRP) through Capitec.

Capitec Pay allows clients to authorise recurring payments directly from their bank account using the Capitec app. The client approves once securely inside the app, after which payments run automatically according to the agreed schedule.

Behind the scenes, Pay@ was the first third-party payment provider to integrate with Capitec and helped shape its development as an open banking payment method, enabling billers to connect into Capitec’s infrastructure so clients can pay them directly through the Capitec app.

The process is designed to be simple:

A client selects Capitec Pay when signing up for a service;
The service sends a secure payment request to the Capitec app;
The client reviews and approves the mandate once;
Recurring payments then run automatically according to the agreed terms; and
Both merchant and client receive confirmation in real time.

Why payment infrastructure matters for merchants

For merchants and subscription-based businesses, the implications are significant. Reliable payment systems form the foundation of any recurring revenue model, and even a small number of failed payments can substantially affect cash flow, client churn and operational costs.

Account-based recurring payments help increase payment reliability in three ways:

Reducing reliance on card networks, which means fewer failed payments from expired cards or scheme-level issues;
Offering real-time confirmation and reconciliation, helping finance and operations teams track payment success rates and simplifying accounting; and
Often lowering transaction costs, especially for high-volume recurring payments, compared with card networks.

Client trust and control

For the client, the shift towards account-based payments removes a long-standing concern: control.

Debit orders have, in the past, been a somewhat opaque process for clients. They might notice a deduction on their statement, but not necessarily recall the exact circumstances in which they authorised the mandate.

VRP-style systems change that. The initial authorisation takes place in the client’s own banking ecosystem, where they can clearly see the merchant, the payment terms and the frequency of debits. That builds trust, and approving in the app adds a layer of security.

A collaboration model for payment innovation

One key lesson from developments like Capitec Pay is that payment innovation rarely happens in isolation.

Fintech infrastructure providers contribute the integration layers and the transaction engines. Banks contribute trusted client channels. Merchants contribute the use cases.

When all the pieces work well together, a simplified process emerges – participants can launch new payment models rapidly without building complex systems from scratch.

That collaborative approach is becoming what defines the next phase of payments innovation.

How payment infrastructure is changing the fintech landscape

The most visible parts of fintech often attract the most attention: the apps, the interfaces, the client-facing features.

But the real transformation is happening deeper in the stack.

Payments infrastructure – the platforms that connect banks, merchants and clients – is reshaping how money moves through the economy.

In South Africa, Capitec’s newly launched variable recurring payments model shows how infrastructure-led design can enable new payment models without adding complexity for users, with Pay@ enabling billers to plug into this framework via the Capitec app.

As recurring payments continue to grow across industries, this infrastructure will play an important role in how well businesses run, how well money flows and how much control clients keep over their own finances.

The future of payments is infrastructure, not just another app.

Capitec clients can authorise recurring payments directly in the Capitec app. Billers and merchants that want to connect to this infrastructure can do so through Pay@’s integration with Capitec.