Recurring Payment Merchant Account

For many businesses, a constant flow of revenue is essential to the growth and maintenance of the company. The recurring payment system is the backbone of such companies, ensuring they run smoothly. 

Whether you run a membership package or subscription model, your company needs an approach that seamlessly processes all types of repeat payments. PaymentUSA’s top-shelf recurring payment solutions are what you need to enjoy a whole lot of benefits in one package. 

This article is for you if you do not understand how a recurring payment solution works. It includes a comprehensive guide to setting up an account and explores which solutions will be beneficial to your company.

What Is Recurring Payment Processing?

Recurring payment processing involves repeat billing of customers. It involves a business charging a client’s card for a product or service at regular intervals. The timeframe when the bill is cleared varies. 

For some companies, it could be monthly, weekly, quarterly, or annually. Other enterprises give customers the power to choose the billing deadline, which is a great customer-centered approach.

This presents an optimal way for processing payments since it is beneficial to the business and the customer. Often known as “automatic payments,” it is essential to note your customer does not have to be present physically or virtually. 

Recurring payment processing relies on a card-not-present format, with an option that allows clients to store their card details on your platform. As a merchant, it is probably in your best interest that your customer saves their information with you to ensure a swift, regular payment. 

In the past, subscriptions and recurring billing was the preserve of the print media, gyms, and cable companies. However, many businesses are migrating to this format. Later, we will discuss different companies that now use this model.

How a Recurring Payment System Works

To the customer, the process of recurring payment is swift and easy. All they need is to provide their payment details. From there, an agreed amount is charged at the end of a specified period. 

To the merchant, it is far from simple. Processing a recurring payment requires a payment service provider and merchant account which enables you to process these payments digitally. 

A merchant account is a bank account  that your customers pay into before the money is transferred to your business account. Usually, these funds are processed by third parties and it could take up to 48 business hours before they become available for your use.

A payment service provider like PaymentUSA helps to process recurring payments. We allow you to process these payments electronically. 

There are several steps involved when processing such payment:

While the process seems complicated, it actually takes place in seconds. With the right recurring payment software, this goes on at regular intervals and the process goes without a hitch

Benefits of the Recurring Payment System

There are several benefits of using a recurring payment system. Besides the obvious benefit of regular cash flow, customers and merchants can enjoy the following advantages.

More convenience

With recurring payments, your customers can conveniently renew a subscription. The work is done on the backend, and they only have to submit their payment information. They don’t even need to worry about submitting details every time, as they can save them on your platform.

With this automatic payment, it’s easier for your customers to continuously enjoy your company’s services without interruption. Once a billing cycle is almost ended, the client pays for a renewal without going through a stressful order process. 

This is a crucial way to build customer loyalty and hence, your brand.

Save the headache of administrative issues

No business wants to focus on issues that can be solved by signing up for innovative technological features. Automating your customers’ payments can save you the hassle and time required to confirm orders. 

Saving their payment details on a secure platform like PaymentUSA ensures your cash flow is on time and stress-free.

Cash flow stability

Creating an avenue for continuous cash flow is instrumental to the growth and stability of any company. This is, perhaps, one of the top three issues any business person faces as an owner. 

When clients do not pay on time, the headache of finding additional sources of revenue generation becomes paramount. This leads to seeking funds elsewhere, including loans that could be stressful for the business. Up to 63% of business owners claim to have infused personal funds at one time or another into their companies. 

With recurring payment processing, cash flow comes in when expected, making business analysis and projection simpler.  In addition, collection costs are lower with this system in place. Hence, your company is in a better economic place since you can plan better.

No more payment reminders

Most people do not like to get notifications of upcoming bills. The recurring payment system ensures everyone can settle their payments without thinking much about it.

Customer retention

One of the advantages recurring payment offers is the chance to build an active customer base through the power of recurring billing. It’s a great way to separate existing clients from new purchasers since most regular customers use the “save card” option. 

With the right recurring payment software, it is easy to know how many customers are available and offer them stellar services. This is another way to improve customer service, which builds on their resolve to continuously patronize you.

Businesses That Need Recurring Payment Processing

There are several use cases for businesses that need a recurring payment system. Some of them include the following:

Subscription services

The primary users of a recurring payment solution are those that offer subscriptions. Print media, streaming platforms, and SaaS services all use the recurring payment model, so customers don’t waste time enjoying their benefits. 

Usually, billing is made monthly.

Memberships

Businesses that use a membership package use a recurring payment system. Examples are co-working spaces, gyms, and professional and social organizations. Payments can usually be made monthly, quarterly or annually.

Payment plan services

Companies with premium services, such as wedding planners and real estate firms, generally allow customers to divide payments into a scheduled plan. Payments are broken into parts, allowing the customers to pay within a timeframe at agreed intervals.

One-on-one services

1:1 services are yet another beneficiary of the recurring payment system. If you charge a set rate for the period where the service is being used, recurring payment processing is the way to go. 

Such businesses include legal aid, personal training, and child care services.

Top Recurring Payment Solutions

There are diverse solutions available for merchants to use when subscribing to a recurring payment system. While it may be confusing to choose one, the choice depends on what type of services or products you offer, as well as other demands of the company. Let’s look at some of the options.

Payment gateways

A payment gateway is an essential tool for recurring payments. Most companies decide to work directly with such a platform. While this offers a cheaper solution, it has its own issues since relying on one payment gateway for all payment processing can be risky.

Accounting software

This solution is usually preferred by companies with limited plans and a small but stable pool of clients. Although the ability to process payments for customers by preparing invoices is much better than hardcopy billing, companies with a large customer base cannot rely on this method.

Subscription model and billing platforms

Top recurring payment processing platforms like PaymentUSA use multiple payment gateways for you. There are also numerous subscription options, each with the right tools for in-depth analysis and insights to grow your business. 

Advanced billing features also allow you to recover revenue through proven methods, so you don’t lose out on relevant cash flow.

Which Recurring Payment Solution Works Best for My Business?

There are solutions anyone can employ to optimize recurring payment processing for their business. However, you need to know what the demands of the company are. Anyone wishing to process recurring payments must  understand that while repeat billing and invoicing are essential, using a one-time purchase model is necessary. 

However, there are many dangers of limiting one’s business to a single payment gateway. Having multiple options to choose from when a customer wants to make payments is preferable. At the top level, geolocation and product type are the primary issues anyone will face regarding payment gateways. 

Besides, failure in connecting to payment gateways often occurs. Hence, having the chance to quickly switch to an alternative is the best business decision any owner can make regarding their payments.

Costs of Recurring Payment Processing

Since recurring payment solutions revolve around a card-not-present format, the risk of fraud is higher than usual. Since the customer is not present and cannot give permission for the card to be charged, some can claim that the card details were stolen. Hence, the rates for recurring payment processing may be higher than usual. 

As it stands, each payment provider sets its own processing fees.

Setting Up Recurring Payments for Your Business

For a merchant, different methods are available to set up a recurring payment. However, to a customer, they all look the same – the idea is to ensure seamless payment without issues. 

As a merchant, you need to take note of specific metrics for recurring payment processing. This also depends on your payment setup since not all methods are designed to work for all business types.

Choosing a Payment Processor

There are several factors you need to consider when setting up the process for recurring payments. Chief among them is the choice of a payment processor. Reputable providers offer  a virtual terminal where you can set your own charges or rates online. In addition, a virtual terminal also has multiple functions, like assisting with failed payments. 

Hence, the choice of a payment processor that has various solutions to select from is essential when looking to set up recurring payment processing for your company. This allows you to choose a strategy that fits your firm’s ideals without paying a hefty price. 

Since you already know that choosing a payment processor is essential, here are questions to help you determine which partner is ideal for your business.

- Which payment types are best for your business?

It’s always good to determine which payment options you want your business to offer. For instance, do you want to simply provide a recurring payment system or also allow customers to pay for a one-time service or product? 

Are you interested in offering a bonus system to your clients when they pay for a subscription, all in one click?

Having an idea of the payment format allows you to streamline potential candidates for a payment provider partner.

- What is the integration module like?

Payment providers come with many features and tools to help their merchants enjoy seamless processes. Hence, confirming that the integration process is simple, fast, and efficient is essential. 

Go for a payment provider with a complete API, which allows you to connect it to your systems without hitches. From a business perspective, quickly integrating with the right tools will enable you to treat your customers well. 

A failure of this aspect means your customers are likely to experience issues when making purchases.

- Is the process of setting up payments easy?

It is essential that the payment provider complies with PCI DSS guidelines. This is crucial, especially if you’re looking to store, transmit, and process credit cards. 

Thankfully, you don’t have to attend to PCI compliance on your own. By partnering with a provider that does so, you’re covered from issues regarding PCI compliance in the future.

- Competitive pricing

Another essential feature to look out for in a payment processor is their rates. Since you understand that firms charge their merchants differently, confirming what the charges are is essential. 

A good way to do this is to ask for quotes from three different payment providers, so you can compare. This helps you understand what you’re paying for before signing a contract. 

Most platforms charge per transaction when it comes to recurring payment solutions, particularly with credit cards. However, if you regularly process a high number of transactions, it is possible to negotiate with the recurring payments processing firm.

- Customer support

Before selecting any payment provider, identifying the standard of their technical support is non-negotiable. No customer wants to settle for a platform with glitches in their payment module. 

When technical problems do occur, it’s vital to have access to professional support to provide assistance.

Getting Started with PaymentUSA

If you’re searching for a recurring payment processing system for your company, PaymentUSA is the answer. With our fully automated and tailor-made solutions, all your accounting demands can be met. Whether you’re looking to make a complete switch to a recurring payment system or add it as part of your payment options, we can help. 

Our strategies eliminate all manual record-keeping with a recurring credit card processing environment that requires zero human intervention. Features include: 

  • Reduced instances of late payments for recurring payment accounts.
  • Automated receipts for customers with billing schedule customization options.
  • PCI-compliant systems that provide easy and secure access to customer accounts.
  • Seamless integration into existing applications, websites, and CRM systems. 

So, whether you want to accept recurring credit card payments or any other mode of recurring billing, PaymentUSA has a comprehensive solution for every industry, no matter how big or small. 

We also provide custom integration for your business with our top-quality API. Companies with global aspirations are not left out, either, as PaymentUSA supports many international currencies and payment systems with the official exchange rate. 

Discuss how our dedicated plans can help your business when you book a consultation with our team. Learn more about how you can improve the payment model of your business. With PaymentUSA, it’s easy to receive payments from your customers without headaches and hassles.