What is Recurring Billing and Why accept it?
You may be thinking to yourself what exactly is recurring billing? Well, we have the answer for you. Recurring Billing is when you purchase a product or service that will then be paid through a schedule whether it's monthly, quarterly, annually etc. This payment arranged through a schedule will continue until the subscription has been cancelled or expired. It is said that recurring billing is considered the center of the subscription economy. In order to manage recurring billing cycles you need a safe and reliable database holder to help record the customer’s activity. Recurring Billing can be beneficial for both the consumers and the business, so why not hop on board?
Lets now discuss, how recurring billing is beneficial for your business. An obvious reason to accept this type of payment is the fact that you get paid repeatedly. We are going to explain four other main reasons as to why your should acquire recurring billing:
Late payments- As a business owner, your life may already be very hectic and as a result you do not want to worry about the hassle of customers obtaining late payments. Recurring billing can eliminate late payments as being your problem. Not to mention that late payments are not just a nuisance to deal with, but also are negative for the company's cash flow. Most businesses charge a fee for customers that have to pay their bills late. Consequently, this can hurt the customer satisfaction or loyalty that customer once had for the company. Never does a company want that sort of separation, and because of this recurring billing is the perfect solution. This is the solution, because it solidifies that you get paid on time, while also securing that the customer never misses a payment which results in no late fees and a happy customer.
Security- With recurring billing, there is no physical paperwork involved, making it less of an inconvenience for customers to transfer or fill out the information. More importantly, recurring billing provides as a safer keepsake for the data being held. It also decreases the risk of the financial data being misplaced or even duplicated.
Expensive- Just as late fees can be expensive for a consumer, paper-based payment can cause inconsistent cash flow, resulting in more costly business expenses and more difficult bookkeeping.
Cancelled subscriptions- Short and sweet: It is less likely for your customers to voluntarily cancel their recurring billing, due to the fact that you have established a relationship with the company as well as this payment method has become easy for them and would be hard to restructure a new billing system.
