Recurring Billing Software

Billing may not be the most exciting business task, but it is indeed one of the most important functions that can affect the profitability of a business. Regardless of the industry, managing subscribers, invoicing errors, and loss of revenue due to failed payments can be taxing for billing managers, especially when dealing with recurring billing.

Recurring billing software enables businesses to handle billing and payment processes for recurring transactions. The software can generate recurring invoices, process payments, track payment history, and analyze the revenue generated by transactions. Online subscription services, fitness studios, and professional service firms are some of the businesses that can benefit from recurring billing software.

This guide will cover what recurring billing software is, the benefits of recurring billing tools, common features, and more. 

What is recurring billing software?

Recurring billing software is an online solution that enables subscription-based businesses to manage recurring invoices and payments. The software automatically charges customers on a regular basis—for example monthly, quarterly, or annually—based on the goods and services they have agreed to purchase. It also helps businesses manage and track recurring revenue streams. 

What are some common features of recurring billing software?

• Recurring invoicing: Automatically generates and sends invoices to customers at predetermined intervals. This is specifically helpful for businesses with a subscription-based billing model or the ones that sell goods and services on a recurring basis.

• Recurring/subscription billing: Enables businesses to charge customers on a regular basis, which helps save time and manual efforts. The software may also include features for subscription management and tracking subscription revenue.

• Self-service portal: Allows customers to manage their subscriptions and billing information via an online portal. The self-service portal enables customers to view their billing history, manage subscription plans, update payment methods, and more.

• Dunning management: Manages the complications of payment failure or credit card declines. Dunning management includes the ability to send automated reminders to customers who have not made their payments on time or notifications for declined payments. Most recurring billing tools allow users to customize the actions the system will take in case of payment declined.

• Multiple payment options: Offers multiple options, such as debit/card payments and bank transfers for accepting payments. This makes it convenient for customers to make payments and also increases the prospects of successfully collecting payments.

• Multi-currency: Allows businesses to accept payments in multiple currencies. This feature is especially useful for businesses with operations worldwide as it allows them to accept payments from customers in their local currency.

What are the benefits of recurring billing software?

• Improves cash flow: Recurring billing tools offer features that help businesses predict and plan their income based on the payments they are likely to receive in the future. Most of the software solutions offer reminders to ensure that the payments are received on a predictable schedule.

• Reduces administrative costs: Recurring billing platform automates the billing process for users. The software is capable of generating unlimited invoices, sending reminders, and processing payments which lowers the administrative burden on the billing staff and reduces overhead costs associated with manual billing processes.

• Enhances data security: Regardless of the type of business you have, customer data security is of prime importance for the success of your business. Recurring billing software offers necessary security features, such as data encryption, password protection, secure transmission, and two-factor authentication to safeguard important business data and prevent it from being misused. 

• Improves customer retention: Recurring billing platforms typically include features, such as subscription management, customization, automatic billing, and refund management that eliminates billing errors. The software also features a self-service portal for clients that enables customers to manage their billing and subscription preferences. All of these help enhance customer experience and improve retention.

What is the cost of recurring billing software?

Recurring billing software cost in the following price ranges*:

• $4.5 - $11

• $12 - $22

• $22+

Most products in the market are priced on a per month basis and can be divided into three pricing tiers based on their starting price.

What are the key questions to ask when choosing recurring billing software?

• What are the payment options supported by the software?

Before you invest in an automated recurring billing tool, make sure to ask the vendor about the payment gateway options supported by the system. The best recurring billing software should be able to support multiple payment options—such as debit cards, credit cards, ACH payments, and PayPal—to ensure hassle-free billing.

• Does the software support integration?

Your billing software should be able to easily integrate with existing tools and other third-party applications to ensure smooth operations. In general, a recurring billing system should integrate with enterprise resource planning (ERP), customer relationship management (CRM), marketing, customer support, and accounting software solutions. 

• Does the software provide multinational support?

Going global should not be a reason to worry. Make sure that the software solution you select allows for easy localization. The system should offer multiple language and currency options to support region-specific requirements. 

• Can the software be customized as per requirements?

Recurring billing software solutions may offer a range of customization options, depending on the tool’s functionality. These might include the ability to customize billing schedules for customers and customizable invoice templates. You can ask the vendor about such customization options that can help fulfill your small business needs. 

• Does the software offer reporting capabilities?

Before partnering with a recurring billing system provider, do check whether the software is able to generate necessary reports, such as customer, subscription, payment history, recurring revenue, and failed payment reports that can be customized further based on your business requirements.  

• What are the available pricing models?

Recurring billing software providers offer different pricing models, such as annual and monthly subscriptions to choose from. Some vendors also offer a free version of their product that helps you test the features of the software before upgrading to a paid plan. As a small business owner, you should ask your vendor about the available pricing models and select the one that best fits your needs and budget. 

Sources

Products evaluated for the pricing calculation were taken from GetApp’s recurring billing software directory. The pricing ranges exclude freemium versions of the products. The features highlighted were identified based on their relevance and the percentage of products in the Get App’s directory that offer them.

*The pricing included is for the entry-level/lowest-priced offerings found on vendor websites as of January 03, 2023. These ranges correspond to the 25th, 75th, and 100th percentiles of pricing information gathered from vendor websites of sample products.

The above list includes pricing for the base plans of most products. An enterprise or premium product that is priced higher may include additional features such as deferred billing, refund management, discount management, and order management.