Easiest & Cheapest Ways to Accept Recurring Payments in 2022

Cody Cromwell
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How Do Recurring Payments Work?

A recurring payment is a service that automatically charges your credit card on a regular schedule.

Examples:

  • If you buy a subscription to the gym, you pay every month automatically.
  • You check out at a grocery store, and you pay for your items automatically.
  • If you open an account with Wells Fargo, you can check your balance after every few days.
  • Or if you associate your Spotify account with your credit card, you are charged a small monthly fee. In this case, that fee is automatically deposited to your account.

What Does a Recurring Payment Mean for You?

Shippers are increasingly using recurring payments methods. It makes sense—recurring payments are convenient for customers.

You can feel confident that your recurring payments won’t get lost in the muddle.

How Do Recurring Payments Work in Retail?

Example 1

This example is based on the recurring payroll deduction (a.k.a recurring paycheck and monthly recurring donation) business model.

You are a customer in need of a service and you will desire to get a tracking number for the service or product you just purchased.

In this case, you are paying for that service every month automatically. It will get added to your checking or savings account which you can access for payment.

How Your Business Benefits From Recurring Payments

A recurring payment is just a predefined amount of recurring revenue that your customer is automatically billed for. These payments remove the hassle of managing recurring plans and the uncertainty of customers’ availability and willingness to opt-in. Hence, recurring payments are the simplest way to automate recurring revenue stream.

Recurring payments help your business generate recurring revenue quickly and easily as a recurring plan helps customers to trust your business with their recurring payments.

Recurring payments also help your business to take care of your recurring customers. And that’s when you can increase the value of your business by nurturing your customer relationships.

Square

PROS

CONS

Q: What would you do if you had recurring payments all set to go but your account was not set up to accept recurring payments?

66% said they would pay their subscription via Apple Pay or Google Pay (no surprise). But the huge surprise was that 18% would use a card and then pay off the card rather than process it using Apple Pay or Google Pay. To me, it shows that even though Apple Pay and Google Pay are the 2 most popular payment options in 2021, they need to do more to ensure that their users are not stuck with the monthly recurring payments. This is especially true for recurring subscriptions.

Q: What would you use to accept recurring payments?

{1}. Wallet/App (73%)
{2}. Card (18%).

There is an obvious reason why they might not like to use Apple Pay or Google Pay. Many of their users (and users in general) don’t own Apple Pay or Google Pay. For businesses, only about 40% of consumers own Apple Pay or Google Pay. But still, these companies have to do better to make it easy for consumers to use their payment option for recurring subscriptions.

How to Set up Recurring Payments With Square

PayPal

PayPal''s best-in-class experience is coupled with lower fees than other payment systems that are set to launch in the future. The newest PayPal cards are even being sold as Pull and Pay at Walmart stores. While this move will bring PayPal into new categories and retail channels, the key to PayPal''s success will be whether or not it can offer the same and better experience than other payment forms.

The PayPal debit card is linked to PayPal''s platform and allows users to make card-to-card payments. This form of payments is being combined with PayPal''s online marketplace where consumers can buy items and make payments using pre-branded smart cards. This move will lower the difficulty of the consumers'' decision-making process and help them to one-step shop.

Customers can also link their PayPal accounts with popular payment terminals to make payments at thousands of retail locations. This will help them reduce the transaction fees charged by retail stores and also allow them to use cash while improving the speed of transactions.

PayPal''s feature of being able to make payments with their debit cards and online marketplaces can easily be juxtaposed with the MasterCard and Visa who are also working on their own forms of mobile payments.

PayPal''s surge in dominance was cemented by the development of offline payments that acts to enhance the level of convenience for customers.

PROS

CONS

Q: What would you do if you had recurring payments all set to go but your account was not set up to accept recurring payments?

66% said they would pay their subscription via Apple Pay or Google Pay (no surprise). But the huge surprise was that 18% would use a card and then pay off the card rather than process it using Apple Pay or Google Pay. To me, it shows that even though Apple Pay and Google Pay are the 2 most popular payment options in 2021, they need to do more to ensure that their users are not stuck with the monthly recurring payments. This is especially true for recurring subscriptions.

Q: What would you use to accept recurring payments?

{1}. Wallet/App (73%)
{2}. Card (18%).

There is an obvious reason why they might not like to use Apple Pay or Google Pay. Many of their users (and users in general) don’t own Apple Pay or Google Pay. For businesses, only about 40% of consumers own Apple Pay or Google Pay. But still, these companies have to do better to make it easy for consumers to use their payment option for recurring subscriptions.

How to Accept Recurring Payments With PayPal

PayPal is one of the easiest ways to accept recurring payments for your online store. And as PayPal is an internationally well-known and accepted payment method, finding a payment solution for your store is easier.

The following are some of the toughest reasons for accepting recurring payments with PayPal.

QuickBooks Payments

QuickBooks is a popular accounting software used in small businesses… but it can be tough to integrate a payer’s payment information in QuickBooks.

One of the easiest ways to receive recurring payments in QuickBooks is to use QuickBooks Payments in combination with other payment gateways.

With QuickBooks Payments, your customers need only remember to log in to your website or app and complete the recurring portion of their payment information (such as shipping and payment method) to create an online recurring payment.

This not only means that you don’t have to push any complex integration between your website or app and your merchant account, you don’t even have to create an account.

It also allows your customers to remain on the same website or app page to update their payment information for each recurring payment… no need to open another page or go through another transaction confirmation page.

This configuration might be tough if you have multiple payment gateways to manage, but one of the easiest ways to implement this is with PayPal.

Using Stripe + PayPal to Process Recurring Payments in QuickBooks

Whether you’re already using Stripe or PayPal, or if your customers are using PayPal, you can use the Stripe + PayPal payment gateway to create a recurring QuickBooks Payments subscription.

PROS

CONS

Q: What would you do if you had recurring payments all set to go but your account was not set up to accept recurring payments?

66% said they would pay their subscription via Apple Pay or Google Pay (no surprise). But the huge surprise was that 18% would use a card and then pay off the card rather than process it using Apple Pay or Google Pay. To me, it shows that even though Apple Pay and Google Pay are the 2 most popular payment options in 2021, they need to do more to ensure that their users are not stuck with the monthly recurring payments. This is especially true for recurring subscriptions.

Q: What would you use to accept recurring payments?

{1}. Wallet/App (73%)
{2}. Card (18%).

There is an obvious reason why they might not like to use Apple Pay or Google Pay. Many of their users (and users in general) don’t own Apple Pay or Google Pay. For businesses, only about 40% of consumers own Apple Pay or Google Pay. But still, these companies have to do better to make it easy for consumers to use their payment option for recurring subscriptions.

How to Accept Recurring Payments With QuickBooks

If you know how to track your revenue and cost of goods sold (COGS) through QuickBooks Online, you can add the recurring payment and accept payments from customers without using PayPal or any other e-commerce provider. This may prove to be a better option than 2% that is charged on non-recurring payments.

As the name suggests, recurring payments work nicely in a monthly basis, allowing you to periodically collect small incomes from your customers. In this tutorial, you will learn how to set up your recurring payments in QuickBooks Online which will help you process recurring payments quickly and securely.

The process involves the following steps:

  • Register as a merchant account
  • Create a payment method
  • Create a recurring payment
  • Accept recurring payments

Fattmerchant

Payments and Marketplaces are increasingly merging, and with Fattmerchant, you can make this blockchain-powered, recurring payments simple for your customers.

Fattmerchant helps make it easier for you to accept recurring payments. By establishing a continuous recurring payment with your customers, you can build a level of trust with them that you would not be able to build otherwise.

Fattmerchant is a blockchain-powered platform that provides recurring payments for your customers. With Fattmerchant, you can easily update your recurring payments schedule or even eliminate fees on transaction service fees with your loyal customers.

You can give your customers the option to choose from a wide range of Fattmerchant payment buttons. In addition to the Fattmerchant logo, our platform includes a text link and a QR code that you can use to accept recurring payments.

It’s even possible to create a Fattmerchant multisite where a customer can choose to pay recurring from numerous sites.

There’s a lot of potentials for recurring payments. For example, you can use recurring payments to ensure uninterrupted service for your customers with the recurring payments, helping your customer love to remain loyal to you.

PROS

CONS

Q: What would you do if you had recurring payments all set to go but your account was not set up to accept recurring payments?

66% said they would pay their subscription via Apple Pay or Google Pay (no surprise). But the huge surprise was that 18% would use a card and then pay off the card rather than process it using Apple Pay or Google Pay. To me, it shows that even though Apple Pay and Google Pay are the 2 most popular payment options in 2021, they need to do more to ensure that their users are not stuck with the monthly recurring payments. This is especially true for recurring subscriptions.

Q: What would you use to accept recurring payments?

{1}. Wallet/App (73%)
{2}. Card (18%).

There is an obvious reason why they might not like to use Apple Pay or Google Pay. Many of their users (and users in general) don’t own Apple Pay or Google Pay. For businesses, only about 40% of consumers own Apple Pay or Google Pay. But still, these companies have to do better to make it easy for consumers to use their payment option for recurring subscriptions.

How to Accept Recurring Payments With Fattmerchant

One of the biggest hurdles for any online seller to successfully sell online is just get a steady stream of cash from their customers. People are not used to paying online or using credit card online, and hence, tend to want to pay only when the money is immediately needed.

Starting a business online is not easy and requires a lot of time, money, patience and often, some financial muscle to lure customers. But one of the most probable ways for starting an online business and make money out of it is selling your products online. In case of an online business, most of the value comes from referrals and repeat customers.

Just like it is the case with any other kind of business, the lifetime value of a customer is the most important thing to keep in mind. That’s because once a customer becomes a customer for a lifetime, the business is bound to get a steady stream of funds. And the easiest and possibly the cheapest way to build a complete business that generates recurring income is to accept recurring payments.

Although, during its early stages, any business sells a product or a service as per their customer’s need and price it accordingly. However, more and more people are moving towards selling their products online. When the product is sold on demand basis, it is very important to find the right pricing strategy for maximizing your profits.

PaySimple

PROS

CONS

Q: What would you do if you had recurring payments all set to go but your account was not set up to accept recurring payments?

66% said they would pay their subscription via Apple Pay or Google Pay (no surprise). But the huge surprise was that 18% would use a card and then pay off the card rather than process it using Apple Pay or Google Pay. To me, it shows that even though Apple Pay and Google Pay are the 2 most popular payment options in 2021, they need to do more to ensure that their users are not stuck with the monthly recurring payments. This is especially true for recurring subscriptions.

Q: What would you use to accept recurring payments?

{1}. Wallet/App (73%)
{2}. Card (18%).

There is an obvious reason why they might not like to use Apple Pay or Google Pay. Many of their users (and users in general) don’t own Apple Pay or Google Pay. For businesses, only about 40% of consumers own Apple Pay or Google Pay. But still, these companies have to do better to make it easy for consumers to use their payment option for recurring subscriptions.

How to Accept Recurring Payments With PaySimple

Stripe or Paypal.

Whether you’re in need of recurring payment processing for your events, like recurring subscriptions or recurring donations, or you’d just like to accept recurring payments on your website, PaySimple has a proven track record of giving merchants the tools they need to quickly, easily, and affordably integrate automatic payment subscriptions into their customers’ everyday shopping, errands, and lives.

We offer an all-in-one payment solution, seamlessly integrating an online payment gateway for accepting recurring payments and a custom payment dashboard. This payment dashboard is hosted by web-hosting or application providers like DigitalOcean, or your own custom virtual private server (VPS) at Hover, formerly known as Flywheel. This front-end portal gives you instant access to incoming payments at checkout, captured recurring and recurring payments in real-time, and real-time reporting on subscriptions, promotions, and the success of recurring payments all from a single dashboard.

PaySimple makes it easy for you to accept recurring payments online:

With PaySimple’s Virtual Credit Card, you can easily integrate recurring payments into your websites or mobile apps, giving your customers a smooth shopping experience whether they’re shopping online, in-store, or on-the-go.

Stripe

There are 2 ways to accept recurring payments in 2022 for small websites and 2 ways to accept recurring payments in 2021 for medium-sized or large websites.

PROS

CONS

Q: What would you do if you had recurring payments all set to go but your account was not set up to accept recurring payments?

66% said they would pay their subscription via Apple Pay or Google Pay (no surprise). But the huge surprise was that 18% would use a card and then pay off the card rather than process it using Apple Pay or Google Pay. To me, it shows that even though Apple Pay and Google Pay are the 2 most popular payment options in 2021, they need to do more to ensure that their users are not stuck with the monthly recurring payments. This is especially true for recurring subscriptions.

Q: What would you use to accept recurring payments?

{1}. Wallet/App (73%)
{2}. Card (18%).

There is an obvious reason why they might not like to use Apple Pay or Google Pay. Many of their users (and users in general) don’t own Apple Pay or Google Pay. For businesses, only about 40% of consumers own Apple Pay or Google Pay. But still, these companies have to do better to make it easy for consumers to use their payment option for recurring subscriptions.

How to Accept Recurring Payments With Stripe

The goal of any business is to make as much money as possible in as little time as possible, without sacrificing convenience for customers. And one of the easiest and most cost effective ways to accomplish this goal is to accept recurring payments.

Recurring payments, also called recurring billing, are a type of subscription that lets you gather a monthly fee that is automatically charged to a customer’s payment method.

With subscriptions on the rise, recurring payments are becoming increasingly popular. Customers are more likely to switch to a recurring payment if they can access the benefits right away. There are a couple of ways businesses can take advantage of recurring payments.

The most common way is to use a third-party provider, like Stripe. Stripe allows you to set up a recurring payment scheme within minutes. What’s really great about Stripe is that recurring payments don’t cost you anything.

Every time a payment is successful, your new Stripe account gets charged. You will be charged for processing the payment ( 2.9% on every transaction) but you won’t be charged a subscription fee.

If you take a moment to think about it, this is quite a deal.

Here are some of the benefits that Stripe offers.

Create a recurring payment without any coding. Just define a product and price point, and Stripe does the rest.

Wave

Pay : Future of Online Payments

Publish a catalog of your products & services, invite your customers, and accept prepaid online payments (for repeat purchases) on a single page without any extra software.

WavePay is a payment gateway that uses the Blockchain technology to find the most viable solution to traditional payment methods.

The Blockchain technology has been accepted by mainstream media, and in a general way, people know about Bitcoin. However, there's a group of people who understand the technology in more detail. Among those people, a fair amount of them are developers.

The definition of Blockchain in the simplest way is that it is a distributed ledger that carries all transactions without charging a fee. The concept seems pretty simple, but the Blockchain technology has come to be the best alternative solution to traditional payment methods.

Although the concept isn't new to 2015, the Bitcoin protocol saw light in 2009. The technology has since developed a lot and is presently considered the most advanced solution to the problems of traditional payment methods.

If you send money to someone in a different country, the international wire transfer costs you a lot of money. Unlike traditional methods, the Blockchain technology is completely free of charges.

The credit card has been accepted by almost all merchants and brands to facilitate purchases. However, the process is not completely risk free. A very small percentage (approx. 2%) of the transactions fail, and the card issuer charge the customer fees to cover the losses.

PROS

CONS

Q: What would you do if you had recurring payments all set to go but your account was not set up to accept recurring payments?

66% said they would pay their subscription via Apple Pay or Google Pay (no surprise). But the huge surprise was that 18% would use a card and then pay off the card rather than process it using Apple Pay or Google Pay. To me, it shows that even though Apple Pay and Google Pay are the 2 most popular payment options in 2021, they need to do more to ensure that their users are not stuck with the monthly recurring payments. This is especially true for recurring subscriptions.

Q: What would you use to accept recurring payments?

{1}. Wallet/App (73%)
{2}. Card (18%).

There is an obvious reason why they might not like to use Apple Pay or Google Pay. Many of their users (and users in general) don’t own Apple Pay or Google Pay. For businesses, only about 40% of consumers own Apple Pay or Google Pay. But still, these companies have to do better to make it easy for consumers to use their payment option for recurring subscriptions.

How to Accept Recurring Payments With Wave

Wave makes choosing, tracking, and billing recurring payments to customers easy.

Recurring payments are usually recurring payments from credit cards or a merchant account. Customers love them because it allows them to schedule their monthly bills to fit their budget, and that’s what Wave is all about; convert one easy and automated recurring payment from a recurring payments provider into one seamless recurring payments experience for your customers … and that includes the recurring payment’s customer and merchant.

To learn how to accept recurring payments with Wave or watch the demo video, click the link below.

Who Should Use Recurring Payments

Regardless of your industry, recurring payments are a great alternative to traditional methods. Recurring payments give your customers a stable, predictable method for paying you. Most businesses across all industries are able to take advantage of recurring payments.

Businesses benefit from recurring payments for multiple reasons. Customers don’t have to remember to pay, and they know exactly how much they’re spending.

Some customers will spend more as they grow accustomed to the payment method. You’ll then benefit from this additional revenue coming in.

Additionally, this method of payment balances your cash flow more. This helps your business plan for the future.

Because recurring payments have benefits at every stage of your customer’s journey with you, it’s definitely worth considering.

Costs of Processing Recurring Payments

The costs of processing recurring payments vary depending on the type of transaction being made … recurring payments can be made via credit cards, debit cards, checks or wire transfers.

Processing the transactions these payment types requires different technology; costs can also vary based on the volume, frequency and types of transactions. Because of the varying costs and the risks involved with processing recurring payments, you’ll need to make sure you’re under an appropriate level of coverage.

Payment Parameters for Recurring Payments

The process is similar for all payment types; the only difference is that some of the online payment gateways may not be accepting payment for recurring payments. In that case, you can visit your financial institution to find other partners in your industry that do.

Processing Recurring Payments from New Payment Sources

Credit card and debit card payments are the most frequently used online payment gateways for recurring payments. However, payments can be made as recurring from these payment types as well, but since this is a new type of payment, the average cost will be higher.

One way to lower your recurring payments costs is to get educated on the key benefits of accepting recurring payments. Going forward, you should be able to find a partner that can offer increased flexibility to your customers and improved cash management.

How We Evaluated Recurring Payment Processors

To rank the best recurring payment processors we first had to determine what makes a recurring payment processor unique. Capturing the 12 factors below created an overall rating of 100 and set some of the lowest rated recurring payment processors at the bottom of the list.

Percentage paid by recurring payment processor: This factor clearly defines the monthly fees set by recurring payment processors. On average recurring payment processors charge about 2.6 percent of the total amount paid to the merchant’s bank account. However, each personal finance and merchant account varies, so it can be difficult to truly understand the fees.

Processing fee: When a merchant funds a recurring payment, they are often charged a setup fee that ensures that the recurring payment will be processed on time. A recurring payment processor might charge a funding fee during the transaction processing. This fee is an automatic transfer made once per month to the company’s bank account. A recurring payment processor might also charge a fee when a payment is declined.

Style of product offered: We evaluated each recurring payment processor based on the type of recurring payments they offer. Some recurring payment processors might only accept one type of recurring payment. For example, a recurring payment processor might only accept a recurring payments from eCommerce companies offering online subscriptions.

15% of Overall Score

These days, it’s nothing to hear about a restaurant, bar, or a store being hacked for the 4th time in a year. But even though it seems like this is a common problem these days, that doesn’t stop the restaurant from having a recurring payment plan with credit card company.

Some businesses are still banking on the misconception that credit card numbers are the best way to manage their recurring payments. Business owners, who don’t have much experience or knowhow, think that this is the easiest and fastest way to manage their recurring payments.

It’s a common misconception but it is not the best choice for your business. Here’s a short list of possible issues that can be caused if you choose this method:

When a customer wants to stop payment on their automatic payment, they are required to call the credit card company and follow the procedural steps to cancel it. So in the event that your online payment gateway ever breaks down, it can cause you a lot of headache and aggravation.

30% of Overall Score

PayPal

Summary: PayPal’s integration with the channels you use ensures the smoothest, most user-friendly experience for your customers.

In a world where there are so many payment types and options to choose from, PayPal has the distinction of being both the easiest and cheapest way to accept recurring payments.

One of the many benefits of PayPal is the ease with which you can accept recurring payments – from 30-day recurring subscriptions to yearly membership. Additionally, your business can easily receive payments, manage your subscriptions, process refunds, and view customer accounts.

35% of Overall Score

As you can see, PayPal is very popular with people that pay subscriptions over the internet. For businesses that are looking to accept recurring payments, PayPal is also very popular.

There are a few reasons for this. For one thing, PayPal has been around for a long time and is commonly used by people online. Another reason is that PayPal is very easy to use and offers easy access to IPNs.

That being said, PayPal isn’t necessarily the best choice for all businesses. If you’re just starting out and are looking to accept small recurring payments, Square is probably a better option for your business. This is because you can use a Square credit card reader to instantly take payments using just your smart phone.

You could also consider Google Checkout. Square and Google Checkout both offer an easy interface that gives you an easy way to take payments online. Google Checkout is a bit more affordable than PayPal as well.

As you can see from this infographic, there are many different options for businesses that want to accept recurring payments. What type of recurring payments are you looking to take? May you find the best option for your business by doing a bit of research.

20% of Overall Score

Online payments for goods and services will be the fastest growing payment method for the next 5 years.

The growth of online payments from IoT, mobility, and internet of things (IoT), the rising penetration of mobile phones, and the growing pervasiveness of smartphones and mobile payment applications will all contribute to the gradual acceptance and spread use of online payments in the next 5 years. However, advances in payment technology such as real-time payments will be the driving force behind the decision to adopt online payments.

The average annual growth of online payments over the next 5 years will be 55%, and online payment instruments will account for 36% of the overall industry growth.

A recent report by the ITU and World Bank noted that the majority of emerging market consumers still favor cash payment when making an online purchase.

However, the global online payments market’s growth is expected to slow over the next few years. The major growth in online payments will be driven by emerging and developing economies.

Online payments represent a five-year CAGR of 55%. Online payments service providers and payment service providers will respectively account for 36% and 22% of the overall industry growth.

Bottom Line

There are simple and effective ways to make recurring subscriptions in your business. Various options exist for you to choose from, making it easier to create a recurring subscription solution for your business.

In today’s article, I’ll cover the different options for recurring payments and the best options for 2017. Most of the ideas can be implemented with little effort on your part, which will save you time and money.

To keep things practical, I’ll omit the more complex ability to integrate your payment gateway with your payment processor, as well as any mention of creating set recurring subscriptions.