How Modern Payments Are Reshaping Member Retention

Billing failures are driving retention losses, but Daxko’s payment tools help fitness operators modernize systems, reduce churn and deliver seamless member experiences

One in three gym memberships is canceled due to credit card issues. That’s not just a billing problem — it’s a retention crisis. 

Failed payments don’t just mean lost opportunities, they consume staff time, prevent proactive member engagement and make forecasting unnecessarily difficult. In an environment where Gen Z expects frictionless, mobile-first experiences, every failed charge, missed update and outdated process compounds the risk of churn.

“The average member isn’t just comparing your gym experience to other gyms, they’re comparing it to Amazon, Apple Pay and Venmo,” says Matt Popinski, chief payments officer at Daxko. “If you’re not offering simple, two-click, real-time payments, you’re adding friction to a process that should be invisible.”

Daxko is investing big into eliminating that friction for its customers. With tools like Mobile Billing and Text-To-Pay, the company is positioning itself as the leader in fitness payments, helping operators modernize, retain more members and unlock more predictable cash flow.

Reduce Friction, Increase Conversion

Popinski’s mantra is simple: eliminate barriers.

“It’s about meeting members where they are,” he says. “Seamless, real-time payments eliminate blockers to securing services. Whether it’s renewing a membership or buying a training session, if payment is hard, you’ve already lost.”

Chief technology officer Pat Harper agrees, saying, “We’re focused on simplification and consistency. Fewer failed payments. Fewer support tickets. Less time spent chasing down cash.”

That streamlining directly drives stronger revenue performance. And Daxko’s platform is designed to capitalize on that by integrating alternative payment methods (APMs)—from Apple Pay and Google Pay to crypto and “buy now, pay later” solutions.

“These trends aren’t five years away — they’re happening now,” says Popinski. “Your members already expect to use whatever payment method they prefer. Gyms need the infrastructure to make that possible.”

Automation That Prevents Churn

Popinski says one of Daxko’s most powerful tools is its Card Account Updater (CAU), which automatically updates members’ payment details before a charge is attempted.

“Up to one-third of cancellations stem from credit card issues — most often from expired cards or outdated info,” Popinskin notes. “The CAU eliminates that risk. It dramatically reduces declines and eliminates the need for negative outreach.”

And it’s not just about preventing churn. By automating updates and reducing manual follow-ups, CAU frees up staff to focus on more positive revenue-generating interactions such as upselling services, improving the member experience and actually talking about fitness instead of billing.

Popinski and Harper agree that as the younger generation becomes the more dominant demographic in fitness, payment expectations are shifting rapidly.

“Many Gen Z members don’t even have traditional bank accounts,” says Popinski. “They live in a digital ecosystem – virtual banks, instant transfers and tap-to-pay – the old model of plastic cards and manual entry is obsolete.”

And, simplifying payment doesn’t just help members, it helps operators gain visibility.

“When you automate and streamline payments, you get paid faster,” says Popinski. “That accelerates reporting cycles and makes cash flow more predictable.”

Today, more than 85% of gym payments are recurring, making predictability more important than ever. “Our goal is same-day deposits,” Popinski adds. “Operators should be able to know today what they’ll see in their account tomorrow.”

Future-Proofing the Gym Payment Experience

Daxko isn’t just solving today’s payment problems, it’s engineering the future of gym financial operations.

“We’re building a contemporary payment ecosystem,” says Popinski. “Today’s members want options, and we’re making sure operators can offer them effortlessly.”

That future-proofing includes heavy investment in account validation and security.

“We’re leaning into AI for fraud detection,” Popinski explains. “The next evolution in protection will be heavily focused on it.”

Daxko is also preparing operators for broader industry and policy shifts. Harper notes that the team is exploring ways to integrate HSA and FSA funds, especially in light of federal legislation like the PHIT Act, which could open up eligibility for more fitness-related spending.

“There’s also a lot happening around surcharging and cash discounting,” Harper says. “Operators need to stay compliant with card brand policies, as well as evolving state and federal regulations. We’re on top of all of it.”

One example of this is Flex Ease, a tool Daxko launched in 2023 to help clubs retain more revenue by passing processing costs to cardholders in a compliant, customer-friendly way.

And, as mergers like Capital One’s acquisition of Discover potentially shake up card reissues and payment behavior, Daxko is ensuring its clients stay in sync with the impacts of these  developments.

“We stay tuned into everything from legislation to card brand strategy,” says Harper. “Our clients don’t have time to monitor every shift. That’s our job.”

For operators looking to modernize, Popinski is clear, saying, “Start with the Card Account Updater. If 85–90% of your credit card processing is recurring and you’re seeing declines, CAU can solve 40% of that overnight.”

But ultimately, he says, it’s about more than any single tool. “It’s about having a platform that’s modern at the core. One that evolves with your members, your business and the technology that connects them.”

And that’s where Daxko leads. In a competitive, tech-forward fitness landscape, payments can no longer be an afterthought. With the right platform, they become a lever for growth.

“If your payment experience fails,” says Popinski, “your revenue will too.”