There are tons of monthly recurring billing software solutions available, so it can seem difficult to determine which one is right for your business. This article is meant to help by providing two important factors to consider when choosing a recurring billing tool.
The first factor to consider is which part of the billing cycle you need help with. In broad strokes, recurring billing consists of four steps:
- Setting up trials, recurring billing intervals, and pricing models.
- Checkout (including payment processing and gathering sales tax, GST, and VAT).
- Handling failed payments and customer notifications.
- Reconciling payment with accounts and remitting sales tax, GST, and VAT.
Different monthly recurring billing solutions will cover different areas, so you’ll want to make sure the one you choose has all the features you need (or at least easily integrates with other software).
The second factor to consider is whether or not the solution was built for your type of business. For example, some solutions are only available for SaaS companies (more on this later), while others can also be used by businesses selling physical goods and/or services.
In this post, we review five options — starting with an in-depth review of our solution, FastSpring — by sharing how each solution addresses the two factors above and by providing an overview of each software’s features.
Table of Contents
- FastSpring: All-in-One Billing Solution for SaaS
- Chargebee: Supports Complex Subscription Management
- Recurly: Easily Integrates with Multiple Payment Gateways
- Zoho Subscriptions: Online Subscription Billing Platform
- Wave: Invoicing and Accounting Software for Small Businesses
FastSpring handles the entire monthly recurring billing process from checkout to remitting end-of-year taxes for SaaS companies. To learn more about how FastSpring can help you scale quickly, sign up for a free account or request a demo today.
FastSpring: All-in-One Billing Solution for SaaS
FastSpring is a comprehensive payment solution for all four areas of the billing lifecycle (Factor #1):
- Custom trials, recurring billing intervals, and pricing models.
- Checkout (including payment processing and collecting consumption tax).
- Handling failed payments and customer notifications.
- Reconciling payments with accounts and remitting consumption tax.
We become the liable party for every transaction of our customers. This means we take the lead on legal compliance, collecting and remitting consumption tax, chargebacks, and more.
At FastSpring, we’ve been serving B2B and B2C software companies — including SaaS, digital goods, and one-time downloads — for nearly 20 years (Factor #2).
Case Study Examples
- Capture One Case Study: Learn how Capture One, a professional photo software company, increased conversion rates by 40% and decreased operational costs by 50%.
- InMusic Case Study: Learn how InMusic, an audio software company, reduced cart abandonment by 30%.
- SocialBee Case Study: Learn how SocialBee, a social media management platform, doubled their monthly recurring revenue (MRR).
Let’s look at how FastSpring handles each stage of the billing lifecycle in detail.
Fully Compliant, Custom Trial and Subscription Options (Without Writing Code)
FastSpring lets you create several custom trial and recurring billing models without code, including:
- Automatic weekly, monthly, or yearly recurring billing.
- Prorated billing to accommodate upgrades and downgrades mid-cycle.
- Free or paid trials of any length.
- Trials with or without collecting payment details.
- Automatic or manual renewal.
- Upsells, cross-sells, one-time add-ons, and discounts.
- And much more.
If you need additional flexibility, you can create more complex models using our API and webhooks library.
One point that often gets overlooked is that your recurring billing model will only be effective if it follows local transaction laws and regulations.
For example, at the time of this writing, the Reserve Bank of India (RBI) limits automatic recurring payments to ₹15,000 (approximately $180). If a payment is over that amount, the customer has to manually approve the transaction. To avoid fines, you have to require the customer to manually approve transactions over that amount and you have to file an official mandate with the RBI that outlines how you will comply.
Many subscription management tools will release community updates whenever they learn about new regulations, however, it would be your responsibility to keep track of these updates and make the necessary changes to stay compliant. To handle this, most companies need an entire department dedicated to legal compliance. Even then, it can be very difficult to stay up to date and comply with ever-changing regulations.
FastSpring makes sure that all of your billing models and procedures comply with local regulations.
Our team of legal experts stays up to date on all relevant legalities and offers individual guidance on how to stay compliant. Unlike other payment solutions that leave you on your own to implement solutions, our team will help you implement the necessary procedures at no additional cost.
Bonus: Optimize the Customer Experience with Customer Portals
FastSpring provides a self-serve portal for your customers to renew subscriptions, manage billing periods, update payment information, view payment history, and more. We manage all of the backend maintenance for this portal so your team doesn’t have to. The entire portal can be customized to match your brand for a more seamless customer experience.
Fully Customizable Checkout for International Transactions
Any billing software that processes payments will typically also provide a checkout template where you can add your logo or choose from a list of color schemes. However, these customization options are rarely flexible enough to create a checkout that truly matches your brand identity.
FastSpring gives you full control over the look and feel of your checkout with our Store Builder Library (SBL). This lets you optimize the checkout flow for your particular products and business while providing a consistent customer experience.
You can choose to embed checkout directly on a webpage, integrate a pop-up checkout, or redirect customers to a web storefront that matches your website.
With any checkout configuration, FastSpring lets you accept international transactions right away with:
- Automatic conversions for dozens of currencies: You can set a fixed price in each currency or let FastSpring make the conversions in real-time (you can also disable any currency).
- Automatic translations: You can let the customer choose their preferred language or let FastSpring choose the appropriate language based on their location. (Note: If you’re looking to expand to a region with a language or currency we don’t yet support, reach out to our team and we’ll help you get it set up.)
- Preferred payment methods: While MasterCard and Visa are popular in the United States, other payment methods are more common in other countries. For example, UnionPay is a popular choice in China. FastSpring lets you accept most preferred payment methods around the world (including Visa, PayPal, ACH, and more).
Additionally, payments are more likely to be approved by the card network or issuing bank when the payment gateway has a legal entity in the same location as the buyer. FastSpring partners with multiple international payment gateways and automatically routes each payment through the gateway with the highest approval rates for that region.
Finally, FastSpring helps ensure only valid transactions are going through by partnering with Sift, a global leader in risk management. Sift uses machine learning and AI to detect signs of fraud (while lowering false positives), improve approval rates, and stop bad actors seeking to defraud companies. FastSpring can also block transactions from countries and jurisdictions where companies are currently not allowed to do business.
In the event of fraudulent transactions and chargebacks, we take the lead to resolve the issue.
Easily Collect Consumption Tax for Any Tax Jurisdiction
In the past, SaaS companies didn’t have to collect consumption tax. However, many countries are now requiring it. So, SaaS companies can no longer ignore sales tax and VAT laws.
Consumption tax is almost always calculated based on where the buyer is located, not the seller. So, you’ll need to be familiar with the tax laws in every jurisdiction your customers are located in. Each country, state, and province has different rules about the amount and type of consumption tax that needs to be collected, so it can be a huge task staying up to date with every jurisdiction.
Some billing solutions will help you add taxes to invoices and keep track of any additional information needed to fill out tax forms (e.g., income and expenses), but ultimately, it’s up to you.
FastSpring takes on the responsibility of calculating and collecting the right type and amount of tax. Taxes are automatically displayed and added to the customer-facing price at checkout. We also support tax-exempt transactions and other special cases.
Proactive Payment Failure Handling and Customer Notifications
Most recurring billing software offers features to help you retry failed payments and manage customer notifications. However, in our experience, it’s much more effective to send out proactive reminders.
That’s why FastSpring sends out notifications about upcoming payments and expired payment methods before the next payment is due.
Then, if a scheduled payment fails, you can choose to have FastSpring send out multiple payment reminders (and automatically retry the payment before sending out each follow-up reminder). In our experience, this significantly reduces the number of failed payments and involuntary churn.
Additionally, you can choose to continue the customer’s service while follow-up reminders are still being sent to give them a chance to update their payment method.
If the customer fails to update the payment method before the final notification, you can simply pause their service. Pausing their service — rather than canceling it — allows for easy reactivation without having to go through the entire onboarding process again.
Streamline Accounting by Letting FastSpring Balance Transactions
FastSpring relieves some of the burden off of your accounting team by:
- Reconciling all payments and invoices: Instead of managing thousands of transactions yourself, our software and team of accountants handle revenue recognition and balance all transactions for you.
- Remitting consumption tax at the end of each tax period: Staying up to date and complying with local tax laws is a huge task for any company. That’s why we handle the gathering of and remitting all consumption tax for our clients. We also take the lead on all audits.
Although we balance and track all transactions for you, you’ll have full insight into the entire process via the reporting dashboard.
The reporting and analytics dashboard gives you a bird’s eye view into your main sources of revenue, average monthly recurring revenue, and much more.
You can also dig into the details and view reports on customer churn, which pricing models are most effective, where your customers are located, and more.
You can customize and save any report so that you always have the data you need, when you need it. Any report can be shared with key stakeholders via the FastSpring dashboard or as a CSV, PNG, or XLSX spreadsheet export.
Finally, our team can help you find or create the right report to find the answers you need to grow and optimize your SaaS business. With nearly 20 years of experience, we know the best metrics to track to optimize and grow your business.
All FastSpring Services and Features for One Flat-rate Fee
All of the features and services mentioned above are included in one flat-rate fee based on the volume of transactions you move through FastSpring. There are no hidden fees and you’ll only be charged when transactions take place.
Four More Recurring Billing Providers
Chargebee: Supports Complex Subscription Management
Chargebee is a popular subscription billing software. Although Chargebee is solely focused on recurring payments, they offer out-of-the-box integrations with software that helps you manage other parts of the billing lifecycle (e.g., Stripe and QuickBooks).
Here are a few highlights of Chargebee features:
- Usage-based billing, automated invoicing, proration, and more.
- Automated processes for accounts receivable.
- Compliant revenue recognition models.
- Support for in-app purchases.
- Self-service portal for customers.
Recurly: Easily Integrates with Multiple Payment Gateways
Recurly is a recurring billing system that easily integrates with CRMs, ERPs, tax solutions, and over 20 different payment gateways — however, you still have to maintain these connections yourself.
Recurly features include:
- Multiple trial and subscription models.
- Automated and manual recurring invoices.
- Built-in promotional tools.
- Mobile app support.
- Item catalog.
Zoho Subscriptions: Online Subscription Billing Platform
Zoho offers a robust suite of software solutions for various business needs — from marketing to HR to sales. Zoho Subscriptions is their subscription management platform.
Some highlights of Zoho subscriptions functionalities include:
- Invoice templates that are customizable.
- Support for multiple pricing plans.
- Support for cash and check payments (in addition to web-based payments).
- A reporting dashboard to view key subscription metrics.
- Tools to create custom workflow rules.
Wave: Invoicing and Accounting Software for Small Businesses
Wave lets small businesses send invoices, collect online payments, track income and expenses, and manage payroll. Although midsize businesses can also use Wave, they may be a better option for freelancers and early-stage startups.
Here’s an overview of what businesses can do with Wave:
- Automatically sync bank accounts with accounting processes.
- Accept bank deposits, credit card payments, and Apple Pay.
- View accounting reports such as an income statement.
- Automate payroll and pay contractors.
- Schedule a consultation with bookkeeping advisors.
Instead of managing a large software stack, let FastSpring handle the entire payment lifecycle for you. If you think FastSpring could be the best recurring billing software for your business, sign up for a free account or request a demo today.