A recurring payment method is an automated process that regularly enables a charge on a customer’s card without involving either the customer or the merchant. These are also known as subscription payments. This payment gateway allows you to easily make your subscription payments to enjoy the services of various entertaining websites or apps like Netflix, Amazon Prime, Spotify, DropBox, etc.
This technology relieves the customers from the burden of providing their bank details every time they make payments. A mere one-time authentication prevents that. To get a recurring payment service started click on the given below:
But there are certain things that you should know to manage recurring payments efficiently, or it can lead to transaction-related disputes with customers that might cause problems in business proceedings.
Key Factors About Recurring Payment
Recurring Payments have now become an inseparable part of most e-commerce business platforms. Previously it was just used for gym memberships or magazine subscriptions, but now its popularity can be seen in every industry. Over five years, the subscription rate of e-commerce companies has grown over 100% annually, which shows beyond doubt that recurring payments are now the “holy grail” of digital marketing, which you can’t afford to skimp on.
Now let us look at some of the things that you should know before you choose a recurring payment platform:
Make Sure Your Payment Processor is Flexible
This is an essential aspect that you should keep in mind while you opt for the services of recurring payments. It might be the case that often you have your business dealings in international currencies. But if your payment process is not flexible enough to receive such currencies, you might lose your business deal. So make sure the platform you are about to use provides you with this facility.
Keep the Upfront Cost in Mind
It is always better that you wisely opt for a recurring payment system. Avoid buying such a payment gateway that has a huge integration commitment and is highly expensive as it might have lots of additional charges along with it, which will adversely affect your business proceedings.
Churn rates are extremely important for such e-commerce businesses, where the subscription forms part of the company’s main income. It is nothing but the annual percentage rate at which the customers stop the subscription services. So in order to maintain your business profits, surpassing the annual churn rate by the annual growth rate is essential. Opt for such a payment processor that will help you manage and understand your churn rates.
Keep a Check on the Reports Regularly
If you want your business to be a profitable one, you should track your transactions and churn rates on a regular basis. So choose a payment processor that will efficiently keep track of these reports and update your company’s progress on a regular basis.
This is probably the most important aspect that you should be aware of before choosing a recurring billing platform. While you are planning to opt for a payment processor, always check if it complies with the standard payment security practices, that is, PCI (Payment Card Industry). It will be beneficial for you to have built-in fraud protection, to prevent the attacks of cybercriminals.
A recurring payment service is not only safe but also helps you manage your finances better. But it is always prudent to know about all the technicalities involved in it to avoid any inconvenience. You would not want to be in dispute with your customers regarding the payment. Therefore, the best option would be to keep in mind all the factors that affect recurring payments so that your business runs smoothly in terms of payments.