Essential knowledge to understand subscription payments and how they work! :- www.deekpay.com

The world of commerce has undergone a huge transformation as consumer habits change rapidly. For example, the shift from traditional to online shopping could have taken years without the rapid response during the epidemic. But the question for sellers is how can they lead the commerce landscape and compete better? This brings us to the need for subscription payments - from B2B to B2C, auto-debit payment models offer significant advantages. For example, if you want to launch a subscription-based music service or a monthly food delivery service, an auto-debit payment model can help you generate a steady cash flow.

In the past, only large organisations showed a keen interest in subscription-based revenue models. But now, this model is applicable to all businesses of all sizes and types. Whether you are an online merchant, web developer, CEO or freelancer, this model will benefit you. If you'd like to dive deeper into how subscription payments work, read on!

What are subscription payments?

Subscription payments, also known as recurring or auto-debit payment models, are designed to satisfy a business's main focus - its customers. Subscription payments mean that the customer allows the business to automatically debit their bank account for a certain amount of payment for goods or services.

Typically, the customer provides the business with their preferred payment method - a subscription to pay for debit card, credit card or bank account information. At the same time, they authorise the business to make regular deductions - weekly, monthly or even annually.

Once the customer agrees to the terms and conditions of the subscription deal, the business provides consistent product delivery or service access. The issue of late fees or expiry dates no longer exists for the customer or the business. The subscription transaction will continue until the customer revokes the authorisation or the product subscription date expires.

Considerations for Subscription Payments

What subscription payments should do:

Payment processors must be genuine

Your subscription payments and providers must comply with standard practices for payment security. They must have the best security features to avoid any fraudulent behaviour. They should be fully aware of the latest cybercrime attacks and constantly check their features. For example, PayU is RBI compliant and has PCI-DSS certification to provide the best security features.

You must do your research

Different types of businesses require different plans and not every plan is suitable for everyone. Therefore, it is important that you conduct proper research before contacting a payment processor. You should be fully aware of the needs of your customers and which plan is best suited for them. Then, you must find a subscription payment service provider that offers the required flexibility. For example, if you want to receive payments in international currencies, the provider must offer the same.

Subscription Payment Providers Accept Multiple Payment Methods

This means that providers must accept all major debit or credit cards and have relationships with all banks to handle automatic debit services.

Select Automation

Not all payment providers can fully automate the entire payment process. Therefore, you must choose a provider that does not require you to add new staff expenses. It should be able to manage the complete account and provide a seamless customer experience.PayU is a subscription payment service provider that will notify the customer 24 hours before the debit to ensure smooth and secure processing.

Matters that subscription payments should not do:

Don't Ignore Churn

Churn rate is the percentage of customers who may cancel their subscription at any given time. If a company's growth rate is higher than its churn rate, then it is successful. However, churn rates can vary greatly from industry to industry. Therefore, as a business, it is important that you choose a provider that can help you better understand churn and manage the programme.

Don't buy a subscription payment system that has high upfront costs

You don't have to pay a huge amount of money to get a subscription payment system. You have to invest in a system that offers 24×7 integrated support and does not affect your expenses.

Don't Ignore the Impact of Subscription Billing on Your Customers

Many customers tend to ignore their monthly bills after adopting a subscription-based model. Customers set up the system and then often forget about it. Make sure you interact with your customers often, even if they have already settled their bill.

Don't forget to follow the trade

Smooth tracking of subscription transactions is one of the features you must look at before investing in any subscription payment platform. It must provide you access to manage all the transactions. It should also help you get the best industry insights to help your company grow.

reach a verdict

Providing a subscription payment system is not only convenient for customers but also for businesses. It increases customer lifecycle value and reduces problems commonly associated with repeated manual payments. Additionally, businesses can be sure of a steady cash flow for months to come. If you are a business owner who needs to collect repeated payments from your customers, try subscription payments as a smoother and more convenient way to pay.

Choose the most convenient subscription payment option offered by PayU India today!

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Frequently Asked Questions

What are the benefits of adopting subscription payments for your business? Subscription payments can stabilise a business's cash flow and reduce customer acquisition costs. What are the types of subscription payments? There are two types of subscription payments: variable and fixed, which are charged in the form of a membership or subscription fee. Can I set up subscription payments for my customers? Yes, with PayU you can set up weekly, monthly or yearly subscription payments for your customers.