A large part of operating any successful business is providing a positive customer experience. As business owners we approach this in a variety of ways. Naturally, we make sure we are offering top-of-the-line products and services. Then, we give our patrons a customer-friendly shopping environment – whether that environment is virtual or in the real world. Finally, we make it a point to deliver exceptional customer support on the back-end. 

But there’s one part of the shopping experience that all too often gets overlooked – payment for goods and services. Ideally, we want to make the payment process as simple, and as painless, as possible. For a growing number of businesses that means offering a recurring payment option for their regular customers.

What are Recurring Payments?

Recurring payments are automatic transactions that are repeated according to a predetermined schedule. To opt into an automatic repeat payment service, the customer simply submits their payment information to the company’s payment processing system (typically a credit or debit card) and then grants permission for subsequent recurring transactions. The customer’s stored data can then be used to process payments according to the agreed upon schedule. 

The benefits of recurring payments are twofold. The customer enjoys a greater level of convenience, while the business realizes a more predictable revenue stream.

What Types of Businesses Can Benefit from Recurring Payments?

A wide variety of business models can benefit from offering recurring payment options for their customers. While online subscription services might be the most obvious, many businesses (both online and in the real world) rely on recurring payment solutions to better serve their customers. 

For example:

  • Basic Service Providers – Lawn care, childcare, cleaning services, etc.
  • Membership Services – Fitness clubs, dance studios, independent tutors, etc.
  • Subscription Services – Media services such as newspapers, magazines and members-only online content providers.
  • Subscription Box Services – Book-of-the-month-clubs, wine taster clubs, meal-kit companies, etc.
  • Online Service Providers – Software-as-a-service (SaaS), online gaming subscriptions, mobile apps, virtual service providers, etc.

Choosing a Recurring Payment Service

Sprout Funding logoThere are a number of payment services that offer recurring billing features. Each has its own advantages and disadvantages, and no single payment service will be right for every business. You will have to consider the type of services and products you are offering, the demographic of your customer base and, of course, the overall cost in fees to your business. 

The following 5 recurring payment services have earned top marks in the industry, and come highly recommended.


Fattmerchant specializes in subscription-style payment services for small to medium sized businesses. The platform’s user interface allows for both single and recurring invoicing, and vendors can easily set prices and schedules directly from Fattmerchant’s Omni Dashboard. 

The service is, perhaps, best suited for higher volume enterprises. Monthly fees are higher than their competitors, but are slightly offset by the lower transaction fees. This makes it easier for businesses to predict their monthly expenses, but that does come at a cost that may be a disincentive for smaller companies. 

Fattmerchant’s recurring payment features include:

  • Monthly Fees – $99 per month for businesses processing less than $500,000 annually. This rises to $199 for business processing more than $500,000 per year.
  • Recurring Payment Processing Fees – 12 to 15 cents per transaction plus interchange fees.
  • Supported Payment Methods – Most major credit cards, debit cards, and ACH transfers.
  • Support for Subscriber Log-ins for Members’ Only Content – Yes


With nearly 20 years in the industry, PayPal is probably the most recognized payment platform on our shortlist. PayPal’s recurring payments service is an ideal fit for smaller online-based businesses that want to bill customers for a variety of recurring services, and is easily integrated into websites, blogs, and ecommerce sites. 

To access PayPal’s recurring payment services merchants must have a PayPal Pro account, or must subscribe to PayPal’s Virtual Terminal services, both of which come with a $30 monthly fee. The added features provided to members, such as easy shopping cart integration and advanced online invoicing capabilities. Help to offset the additional cost of these services. 

PayPal’s recurring payment service features:

  • Monthly Fees – $10 + $30 for PayPal Pro or PayPal Virtual Terminal = $40 total.
  • Recurring Payment Processing Fees – 2.9% + .30 cents per transaction.
  • Accepted Payment Methods – Credit cards, debit cards, PayPal payments, and eWallet payments.
  • Unsupported Payment Methods – eCheck, ACH transfers
  • Support for Subscriber Log-ins for Members’ Only Content – Yes


PaySimple offers an all-in-one platform specifically designed for service-based businesses. With recurring payments as a built-in feature users will find it easy to manage customer registrations, memberships and subscriptions. Ease of use is one of PaySimple’s major selling points, and vendors will find the intuitive dashboard makes it simple to set up repeated billing schedules, manually process or refund payments, and manually initiate or cancel customer subscriptions. 

While PaySimple is extremely easy to use, it does come at a higher cost than some of its major competitors. Users of the service also report delays in scheduled payouts and some occurrence of unexpected charges to their accounts. 

The PaySimple platform offers the following features:

  • Monthly Fees – $49.95
  • Recurring Payment Processing Fees – 2.49% (ACH and eCheck payments cost an extra .10% + .60 cents per transaction)
  • Accepted Payment Methods – Credit and debit cards, eWallet payments, ACH transfers and eChecks
  • Unsupported Payment Methods – PayPal
  • Support for Subscriber Log-ins for Members Only Content – Yes


Square is a leader in online payment solutions and point of sale systems, and their recurring payment services have become popular with both ecommerce and real world business owners. The firm’s PCI compliant payment system makes allows customers to submit their payment information and save it in Square’s secure payment vault. This helps to ensure that valuable customer dare is safe and secure over the term of their subscription or membership. 

Square works on an invoice payment model, with recurring payments being triggered when a new invoice is created and emailed to the subscribing customer. The invoice acts as both notification and receipt of payment. Like the majority of Squares payment solutions, the company’s recurring payment services are easy to use and are a good fit for most omnichannel businesses. 

Square’s recurring payment service offers the following features:

  • Monthly Fees – $0
  • Recurring Payment Processing Fees – 3.5% + .15 cents per transaction
  • Accepted Payment Methods – Credit and debit cards, eWallet payments
  • Unsupported Payment Methods – eCheck, ACH payments, and PayPal
  • Support for Subscriber Log-ins for Members Only Content – No


Stripe is a relative newcomer to the payment solutions arena, but that hasn’t stopped them from building a strong reputation in the industry. They have become a leading online payment processor, and a major competitor for PayPal and other more established service providers. 

Stripe’s recurring payment services are best suited for online and app-based businesses. Recurring payments are simple to set up, and merchants will find it easy to accept registrations and manage memberships and subscriptions. Stripe is extremely user friendly and can be seamlessly integrated into most ecommerce and blogging platforms. Unlike some of the other payment solutions on our list, Stripe supports international billing and payments. 

Stripe’s recurring payment service offers the following features:

  • Monthly Fees – $0
  • Recurring Payment Processing Fees – 2.9% + .30 cents per transaction
  • Accepted Payment Methods – Credit and debit cards, eWallet payments, ACH transfers, and eChecks
  • Unsupported Payment Methods – PayPal
  • Support for Subscriber Log-ins for Members Only Content – No

In Conclusion

Many different types of businesses can benefit from integrating a recurring payment option into their business model. While it may take a bit of work to set up at first, over the long term it will streamline your payment processes and enhance your customers’ experience with your company. If your business deals in products or services that depend on repeat purchases and scheduled billing, now is the time to enable recurring payments for your most valued customers.


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