As technology advances, many changes take place. E-commerce businesses have now taken over many physical stores. These stores are now popular mainly due to convenience. To ensure a stable flow of sales, there are now subscription-based payment gateways for such businesses.
Businesses can either develop these payment gateways from scratch or use one of the service providers. Development proves to be very difficult; moreover, it is better to use multiple payment gateways. Thus, here are some subscription-based payment gateways for you.
In this article, we will also discuss the reasons why you should invest every month in these web applications. Furthermore, we will help you choose the best ones to ensure smooth and secure operation. Therefore, read till the end to learn all about it!
What is Subscription-Based Payment?
Subscription based payments are payments made on a regular basis, usually charged per month or per annum. This payment system is a plan for those businesses willing to take services from another service provider for a long time. Such a plan will have an outline of the services provided.
The other two names of subscription-based payments are recurring payments and repeated transactions. In simple words, it is when payment is made automatically after a specific time period. Hence, it requires the merchant to input information about their credit cards.
Many services offer subscription-based payment. In the case of payment gateways, merchants will have to pay a service fee after each transaction made by the customers of the online business. It is a cycle and most service providers charge a small percentage of the payment.
Reasons to Invest in Payment Gateways
While there are many reasons to invest in a subscription base payment gateway, I will mention the major reasons only. Check the list below:
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Increase in revenue
If you heard about PayPal, you might already know that most successful companies are working with it. With the integration of subscription-based payment gateways, you can now accept international customers.
There is an opportunity for increased orders when customers find it easy to make payments. And that can eventually lead to higher sales revenue.
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More customer satisfaction
The experience during payments is involved in the process of customer satisfaction. Customers will always look for secured payment gateways that do not risk the leakage of credit card information. Secured sites always invite confidence during purchases.
Here, besides security, they also expect legitimate sites for making payments. Once you subscribe to these providers, you can offer uninterrupted service. In return, there’s more customer satisfaction when your customers make purchases.
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Higher conversion rates
According to a survey conducted by YouGov, there’s a loss of fifty percent in sales when e-commerce platforms don’t provide smooth checkout. They expect it to be user-friendly. Thus, investing in payment gateways every month will result in higher conversion rates.
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Increases Flexibility
With the investment comes the opportunity of achieving flexibility when accepting payments. The best payment gateways work with local banks, e-wallets, and international banks. It gives global and local companies the opportunity to expand their customer base.
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Low Costs
Relative to the benefits of using it, subscription fees are quite low. It is nearly only three percent of the total payment. On the other hand, there are usually no registration fees that might require a large investment. The cost is deducted only during transactions.
Should We Use Multiple Payment Gateways?
It is necessary for businesses to use multiple payment gateways to provide suitable payment methods for all their customers. The same payment gateway might not work for everyone. On the other hand, alternative payment gateways can act as backups for any technical errors.
Various technical errors are common issues for payment gateways. Sometimes, they decline payments and transactions. If this continues for a while, you could lose many customers at once. Many failed attempts, especially for a new customer, might risk sales revenue.
There is a suitable phrase for this situation- never put all your eggs in one basket. Various customers prefer different payment methods. Depending on one payment gateway means eliminating potential customers who prefer other payment gateways.
Similarly, you will achieve flexibility in routing payments with the help of custom gateway routing. It includes reaping the benefits that various payment gateways offer for different transactions; for instance, transactions based on geolocation.
Top 7 Subscription Based Payment Gateways
Here are the most popular payment gateways for subscription billing. The consistency, customer support, cost, easy-to-use features, and payment types justify the top positions they secured in the market. Check whether these are tailored to meet your requirements!
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Adyen
Stripe is recognized for its user-friendly features and the checkout experience. It offers subscription billing. Adyen’s customers are free to pay from a wide range of international cards. For them, there are also customized checkout features online.
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PayPal
PayPal operates in two hundred and two countries and accepts over a hundred and thirty currencies. It is considered the best payment gateway as it is the best for global businesses. Merchants may benefit from large sales volume. Also, it deducts $35 to keep buyers on the site.
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AmazonPay
Checking out is faster than ever with Amazon Pay. Customers also have a lot of payment options while making payments- both credit and debit cards. However, it has transaction fees; for subscription, integrate Recurly to avail recurring bills.
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Braintree
The subscription fees Braintree offers are often relatively low. Thus, it becomes attractive to start-up businesses with a low volume of sales. It accepts digital wallets, credit cards, ACH deposits, and more. On the other hand, it offers flexibility, rewards, and promotional offers.
The most exciting feature is that customers can operate outside their subscription plan. In this case, the balance will be deducted for the extra services. There are also custom plans for businesses for a customized experience.
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net
Authorize.net has Automated Recurring Billing (ARB) that allows merchants to automatically pay the gateway bills. Some of their subscription plans include all services within $25 per month. Besides that, it offers high security to buyers and sellers.
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GoCardless
For those businesses suffering from poor cash flow, GoCardless acts as a perfect payment gateway. It is because it immediately solves technical issues and failed transactions with a small subscription fee each month.
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RazorPay
While most payment gateways are late to approve balance transfers to the merchant’s bank account, RazorPay directly transfers money from the customers’ bank account to the merchant’s. Similarly, it offers loans for businesses suffering from poor cash flow.
5 Tips For Choosing the Best Subscription Based Payment Gateway
If the payment gateways above are out of your reach, select local service providers that are within your budget. It is necessary for your provider to have some standard features. Here, I have provided you with a checklist that you need while choosing the best one:
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Merchant Accounts
After making payments, money is either transferred to the merchant’s accounts or directly to the seller’s bank account. The balance stored in the merchant account is temporary until it transfers to the seller’s bank account.
The advantage of a merchant account is that it ensures proper management and record of transactions. Similarly, it is extra security for the transactions, sellers, and buyers. On the other hand, direct transfers to bank accounts may require higher transaction fees.
However, the customer’s bank must process the transaction first to approve it. Only then the seller can receive it from the merchant’s account.
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Subscriptions
It consumes a lot of time to make payments to the payment gateway service providers. Subscriptions allow merchants to make automatic bills every month. The automatic billing cycle also means that accounts payable will not build up to a large amount.
Furthermore, merchants can expect the total cost of payment gateways per month. Therefore, they can allocate their resources better. Stable recurring bills are always a good option, especially for small businesses.
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Acceptable Credit Cards
Make sure that the subscription based payment gateway accepts multiple credit cards. It should at least accept Visa, American Express, and Mastercard- the most used credit cards. If these are available, look for payment gateways that accept e-wallets.
Many providers don’t accept debit cards. According to statistics, 86% of consumers use debit cards while 63% use credit cards. Thus, your provider must accept local debit cards.
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Various Currency Allowance
It is especially essential to global e-commerce platforms that deal with international clients. It is not possible to accept payments from international clients if your payment gateway doesn’t accept payments in various currencies.
It attracts more customers if they have the freedom to pay in their own currency. Similarly, it provides freedom to local customers who prefer paying in other currencies.
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Responsive Customer Service
Technical problems arise during transactions, even if you best service provider. It is necessary to fix it immediately to maintain customer satisfaction. Most providers limit their helpline to emails; it is risky as most email buildup may lead to late response.
Moreover, there are usually manual protocols to fix a single problem that takes a long time. Live technical support will ensure immediate solutions, so the cash won’t be stuck for prolonged periods. They usually start working on it within minutes if not hours.
Conclusion
Now that you’ve learned about the best subscription based payment gateway, you should check whether their services fit your business needs. The entire idea can first sound confusing, but in reality, it is quite easy to implement the system.
As you implement it, you can concentrate on the online business and its products. I believe I have been able to guide you properly. Without postponing, grab those subscriptions now! Thank you for reading.
FAQs
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Which is the cheapest payment gateway?
Answer: Helcim is the cheapest payment gateway. It charges 0.5% and 25 cents per transaction. The total cost falls as the volume of the transactions increases with sales. Similarly, Paytm Payment Gateway is also another cheap option.
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Why subscription pricing for payment gateways?
Answer: Subscription pricing, also known as recurring billing, for payment gateways allows merchants to make payments effortless. The automatic payment promises uninterrupted service as experts will always monitor the operations.
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Why are payment gateway transaction fees so high?
Answer: Payment gateway transaction fees are usually high because there are multiple parties that work to ensure security during each transaction. For example, provider and issuing bank. Moreover, it covers the processing fees that the bank charges.
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Are subscription charges cheaper?
Answer: Subscription charges are relatively cheaper when e-commerce businesses have a large volume of sales. Here, more transactions can be processed and approved with a fixed subscription fee. Also, many companies charge low subscription fees.
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How do you integrate subscription-based payment gateways?
Answer: To integrate subscription-based payment gateways, you only need to create an account in PayPal or Stripe. After that, select suitable subscription packages for your website. Thirdly, copy and paste codes from the internet to create a payment gateway.
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How many types of payment gateways are there?
Answer: Although some people claim that there are five types, there are mainly four types of payment gateways. These are hosted payment gateway, self-hosted payment gateway, API-hosted payment gateway, and local bank integration gateway.
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What are the main methods of payment?
Answer: There are six major methods of payment. These are cash, mobile payments check, credit cards, debit cards, and electronic bank transfers. To make online transactions, people pay via credit and debit cards.
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What is the most secure payment method?
Answer: The most secure payment method is credit card payment as the receivers and the senders are verified. However, it is still necessary to verify the payment gateway provider- choose regular and popular ones. The next most secure method is debit card payments.
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What types of products and services are suitable for recurring payments?
Answer: While it’s useful for all e-commerce platforms, it is necessary for fundraising, crowdfunding, subscriptions for streaming applications like Netflix, and activities like gym membership. As subscriptions are not one-time payments, these are suitable.
