Recurring Payment Solutions for Subscription Businesses

In India more and more businesses are adopting recurring payments and subscription-based business models. The advantages of a subscription model include predictable growth, steady cash flow, and reduced cost of acquiring customers, reduced retention costs, and inventory management.


The idea of the recurring payments is not something new and was not invented by the sensational brands like Spotify, or Netflix, or by the SAAS brands like Zendesk, Slack, etc. However recurring payment and subscriptions based business models is an extremely effective mode of conducting business with the generation that is preferring subscribing increasingly to a product rather than buying the product. Because of the introduction of Indian consumer-centric brands like Apple Music, Netflix, Amazon Prime, and others, the subscription economy is experiencing a major push in India.


On the B2B front, subscription system is not that new to India, with the brands such as Google, Amazon Web Services and Microsoft is offering a subscription system already to acquire tools and platforms such as email clients, web servers, word processors and others that are an essential part of the business operations. 

Whereas recurring payments have been available for offline transactions through NACH and ECS mandates, the recurring payment system for the online transactions has not picked up the pace in its early days because of the additional restriction of 2-factor verification, made compulsory by the Reserve Bank of India. However, that all changed since the rollout of the RBI notification and emanates on recurring payments.

With such new technology and policies affecting a lot of companies in India will be able to collect the recurring payments now, which is a win-win for the customers as well as for the business. 

Industries Getting Benefitted from Recurring Payments the Most


Subscriptions or Recurring payments can be advantageous for a lot of industrial niches:

  • Entertainment and Content Providers
The extensive exposures consumers have had towards the recurring payment system (subscription-based services) have been in the entertainment and content segments. Most of us would be familiar with the business system that Amazon Prime, Netflix, Medium, Apple Music, and Spotify run on already. They charge you anywhere between Rs 100 to Rs 1000, for monthly or an annual charge and you can access all the available content on their services without any extra charges. In India, even the content-based services such as HOOQ, Hotstar, Zee5, offer subscription systems through credit cards, or digital wallets, lacking vital payment methods like UPI, net banking, and debit cards.

  • SAAS and Tech Businesses

Saas companies are another niche that could benefit potentially a lot from subscription-based systems. This has been obvious with the enormous growth of brands such as Freshdesk, Slack, Salesforce, Intercom, and others. The system has shown promise that even the brands that used to create revenue from one-of the sales of their software revolved to a recurring-payment system for the same. The main examples of such switch have been Adobe and Microsoft (MS Office).


  • Financial and Healthcare Services

Healthcare and Financial services have been the prime examples of the recurring payment-based system. The general insurance, loan-repayments, car insurance, SIP, and mutual fund investments and more models have covered the way for other niches to make their strategy.

  • Utility Billing

Utilities like water, electricity, membership, gym, and such are not considered traditionally as the recurring billing, as the amount is energetic for the most of the utilities when considered the billing frequency, these expenses have to be paid at the given date or you risk policy fines and lapse. 


  • Retail and e-Commerce

Recurring payments and Subscriptions are making inroads into the eCommerce and retail sector rapidly. Brands including Dollar Shave Club and Birchbox displayed how the subscription-based service can be used to build a billion-dollar empire. Such stories have proved as a catalyst for other brands to launch their subscription systems.



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