A subscription payment service is a key component in any SaaS business. It should therefore be scalable and offer multiple features to the business so that it can make your business more efficient and profitable.

To attract customers and retain them, it is important that the subscription service you use is smooth and does not create any problems for the customers. Today we will read about subscription payment solutions, and the best companies offering subscription payment services in the market today.

What are Subscription Payments?

For businesses with a product or service that can be offered over time, a subscription payment is a quick and reliable way to retain customers and create consistent income.

Establishing a long-term buyer commitment can help merchants maintain a customer base with predictable revenue, while consumers enjoy the ease of bill payment via a simple regular subscription payment – it’s a win-win for both parties. A subscription payment can be used for the delivery of both physical and virtual goods which a person might require on regular basis.

For example, these can be groceries, health products, cosmetic products, music, videos, memberships etc. Therefore, subscription payments or recurring payments are scheduled money transfers that occur automatically on a fixated date, every month, quarter or year and is dependent on the merchant's product or service offering to the consumer.

How does it Work?

For subscription payments to work, a customer is required to enter their payment and billing information into the merchants' system. The merchant saves this data securely and data is often encrypted. With this information, the merchant draws down regular fixed payments automatically in line with the agreed subscription date.

Should the customer wish to make additional purchases, then they can just add these to the cart as part of the merchants' self-service flexibility.

The workings of subscription recurring payments can vary for different businesses. For example, in a service-based business, the payment is generally taken on the same day every month for all consumers. Payment for some services may also fluctuate, for example in the ‘utility industry’, electricity, water, and telephony services often send their bills on the same day each month and the bill may fluctuate month to month in some cases.

Benefits of Subscription Payments

The subscription payments model is highly beneficial to businesses in multiple ways. Some of them can be seen below-

1. Predictable Revenue

Once the business onboards a customer then predictable revenue from that customer or group of customers becomes very easy to calculate as the statistical churn rate is known.

It is therefore a simple calculation to work out the predictable revenue going forward. Creating a predictable revenue model allows the business to focus on more sales, customer service and new product innovations.

2. Better Marketing Opportunities

A subscription business payments model allows you to engage with your customers in a more efficient manner. You can reach out through monthly newsletters and email campaigns.

This will create an effective targeted marketing strategy as you are able to get insights into the usage and preferences of the customers. Understanding customers via the data they generate will help build good relationships via targeted messages and campaigns thus allowing you to sell other services more easily.

3. Cash Flow Stability

As the recurring revenue is predictable the cash flow is positive and stable. Recurring payments can be set up easily to ensure a regular and timely cash flow income. You will need to quickly track late payments and engage with customers to try to reduce these instances and therefore avoid unintended churn.

4. Higher Scope of Growth

Subscription payment models offer businesses high levels of flexibility. You may choose to start with a single product or service then as the customer base increases you may choose to add different products or services.

You can meet the needs of clients by offering them more or fewer services and differentiated payment plans via a flexible subscription payment.

5. Benefits for the Consumers

With the subscription payment model, both businesses and the customer benefit. This is because, with the subscription or recurring payments, the customer can provide more revenue to the business in small payments, over the long run.

This doesn’t put a burden on the customer while generating revenue for the business. With attractive prices and plans, you can attract customers to subscribe to your services, and offer them free trials plus discounts.

Features of Good Subscription Payment Service

Businesses listen up! If you are deciding to make a shift to a subscription business model, and are looking for the perfect partner to help you in this, below are some features that you should look for in your subscription payment service provider.

a. Accept Payments in Multiple Forms

Making payment for the customer becomes easier when you offer them several options to make the payment. Thus, it is important that your subscription payment service provider accepts recurring payments through multiple payment methods such as credit cards and debit cards.

b. Flexible Billing

A good subscription service provider can bill for any period- be it monthly, yearly or even a few days. No matter what date the customer signs up on, the service should be able to generate accurate bills and renew billing cycles accordingly.

c. Seamless Management of Subscriptions

Managing the subscriptions involves a plethora of tasks such as managing trials, assigning credits, issuing refunds, allowances for wrongful or unscheduled billings etc. All this should be managed seamlessly by your subscription payment solutions provider.

d. Automated Invoicing

The subscription and billing system should be able to create recurring invoices which are error-free. Based on the information from your accounting systems, they should be able to create customized invoices, consolidated invoicing, advanced invoicing, etc.

e. Security Features

Your customers are storing their payment information with the subscription payment service. Therefore, it is important that it follows the best security parameters to help you gain the trust of your customers. At present, complying with SOC-1, SOC-2 and PCI parameters is the least any subscription service should have.

f. Hassle-Free Checkout

Customers often restrain themselves from making online payments due to the fear of failed payment or some issues related to checkout. Therefore, it is important that the subscription payment service makes the checkout experience of the customer smooth so that they do not fear making online payments again.

g. Effortless Accounting

A subscription payment and billing solution should integrate with accounting software to keep track of discounts, payments, refunds and everything else, to make accounting effortless for you.

h. Subscription Analytics

A subscription payment service that offers essential key metrics to the business on a regular basis is a good one.

There are multiple metrics such as MRR, CAC, Churn Rate etc, which are to be analyzed by the businesses, and a subscription service should help the businesses get those metrics seamlessly.

Top Five Subscription Payment Service

We will now read about the top five subscription payment services in the market in 2022.

1.Billsby Subscription and Billing Service

Billsby comes with an exclusive subscription billing service for SaaS software and businesses. It manages online subscriptions and offers timely discounts, coupons and much more to businesses so that they can keep their customers engaged. It handles all the work related to recurring billing with ease and accuracy.

Features-

a. Easy to Begin With- Billsby subscription payment service is very easy to start and operate. It handles all the tasks for your business while keeping you in complete control.

b. Add New Plans Anytime- You can add new plans and cycles through the Billsby API, based on the customers’ changing needs, without having to do any configuration or development work.

c. Free Trials- It offers your customers chances of free trials and setup fees and then starts applying charges when the trial ends.

d. Multiple Add-On Options- You can create a plethora of plans by adding unlimited add-ons and allowances for your customers. This will help you and your customers access control over the software.

e. Usage Tracking- Billsby offers to track real-time usage information so that you do not need the assistance of separate monitoring systems. This helps you calculate the invoices automatically at the end of the billing cycle of each customer.

f. Multiple Discount Options- With Billsby, you can create as many discounts as you want with your own terms and conditions and choice of the expiry date. You can also offer discounts to special customers.

g. Complete Control- Billsby lets you have complete control over your business and its working.

h. Best-in-class Security- Billbsy comes with the promise of handling the data of your business and your customers with the best security measures in the market.

i. Budget-Friendly- Billsby has budget-friendly plans that are beneficial for all business types from start-ups to larger enterprises, their fees are low at $35/m.

j. Quality of service - Ranked No 1 on g2.com for ease of use.

2. Pabbly Subscription Billing

Pabbly is probably the cheapest billing service available in the market today. Its plans start from as low as $19 per month, with no transaction fees for the businesses. It lets you generate unlimited revenue at no extra charges or additional fees. Even in the basic plan, you get access to all the unlimited features offered by Pabbly.

Features-

a. Recurring and One-Time Billing- You can get the feature of recurring and one-time billing for your software. b. Easy Invoicing- You can quickly generate and send invoices to your customers through email.

c. Analytics- Get a comprehensive analysis of your business activities for growth forecasting.

d. Coupons and Discounts- Offer your customers countless discounts and coupons to lure them.

e. SaaS Integration- You can integrate your Pabbly account to any SaaS-based application with the help of API keys.

f. Unlimited Products and Plans- Create multiple plans and products with one account according to your needs.

3. Freshbooks

This is a well-known subscription payment service that helps businesses generate revenue by automatically completing all tasks such as invoicing, recurring billing, discounts, etc. It lays great focus on the business decisions based on the data and insights of your business.

Features-

a. Automatic Late Fees- You can set automatic late fees after the due date to charge the customer accordingly.

b. Invoicing- Send invoices to your customers on a scheduled basis by creating them once.

c. Tax Calculator- You can calculate taxes easily that are paid or collected by you in any period.

4. Fastspring

This is an excellent tool for businesses who want to sell digital products, which will boost their business. You can control and design shopping carts, order pages and much more with Fastsprings. It is suitable for eCommerce stores as it guarantees payment security by integrating with the top payment gateways in the world.

Features-

a. Mobile Optimisation- This subscription payment service is excellent for businesses with a mobile-based site. It has an ideal display for mobile devices so customers can easily browse and order the products or services.

b. Flexible Plans- It allows you to manage flexible plans with free trials, billings conducted monthly or annually etc.

c. Automatic Notifications- Fastspring helps you maintain better relations and communication with your customer by providing notifications of automatic invoices, receipts and renewals, etc.

d. Dunning Management- It also allows you to send automatic reminders to subscribers so that they do not need to update the information repeatedly.

5. Sellfy

Sellfy is a good subscription payment service with cheap pricing plans. In addition, you can add features like a shopping cart, integration with store page or social media accounts, etc.

Features-

a. Sell Products and Subscriptions- You can sell anything with the subscription payment services of Sellfy.

b. Customization- You can create a customized storefront by adding a custom domain to strengthen your brand further.

c. Analytics- You can track the performance of your business and products and services and the revenue they generate.

FAQs

Q- How to set up subscription payments? Ans- You can set up subscription payments with the help of a subscription business service. You can select the customers you want to bill and the service you want to bill them for, and then choose the “make recurring” option.

Q- How to take subscription payments? Ans- You can handle and receive all your subscription payments by partnering with a subscription service provider or a merchant account. You can also partner with an all-in-one payment processor, but you will still need software to manage the billings.

Q- How to cancel subscription payments? Ans- You can cancel a subscription by emailing the service provider. They might ask for the reason, which you can fill out in the mail and request for installation.