The ways in which people buy and pay for products and services have changed a lot in recent times, thanks to the rise of the internet and other advancements in modern technology and commerce. One of the biggest trends we’re seeing at the moment is the concept of subscription-based goods and services with recurring billing systems.
The way this works is relatively simple: a customer signs up for some sort of service or delivery that is usually provided to them on a regular basis, such as weekly meal delivery, access to a streaming service, or even an online video game membership. They enter their card details and agree to a recurring billing agreement in which money is taken automatically from them each month to pay for the subscription.
Before we look at the specifics of recurring billing merchant accounts and how they work, let’s take a look at what recurring billing actually is. In simple terms, a recurring billing system is when a customer is billed on a regular recurring basis for some sort of service or subscription. A common example would be someone who signs up for a streaming platform gets full access to that platform and has a monthly fee billed automatically to their account in return.
This kind of billing can be used in a lot of different ways. Meal delivery companies, for example, are making use of recurring billing systems for their customers, and other companies in the food and drink world like wine clubs and craft beer deliveries work on a similar principle. The system can also be used for gym memberships, app subscriptions, magazines, clubs, and more.
So what exactly is a recurring billing merchant account and how does this type of account work? Well, it’s important to first understand how merchant accounts work in general; merchant accounts are special types of business accounts that make it possible for businesses to receive electronic card payments from their clients and customers.
Merchant accounts are absolutely essential for any business that does a lot of its sales online, with customers paying remotely for goods and services with their credit and debit cards. So there are lots of different types of businesses out there that use these accounts, and recurring billing merchant accounts can be really vital for companies that offer recurring billing services.
As we can see, having a recurring billing merchant account is really important if you want to be able to accept recurring payments for your products and services, like a streaming service, subscription, or regularly scheduled delivery service. However, the process of actually getting these accounts can be quite a challenge.
A lot of banks and financial institutions may refuse to offer you the recurring billing merchant accounts and services you need. Indeed, many banks don’t offer any kind of merchant accounts for recurring billing companies, because they feel that there are too many risks and potential problems associated with these types of payments.
Businesses that use recurring billing are often classified as “high risk” by banks, and there are a few reasons behind this. The main reason is that there are often lots of chargebacks associated with recurring billing plans and subscriptions. A chargeback is when a cardholder asks for their money back from the bank or card company.
Chargebacks tend to occur quite regularly when it comes to recurring billing payments because people sometimes forget that they have signed up for these recurring payments or are unsure how to cancel their subscriptions and get frustrated when they see money coming out of their account each month. Buyers’ remorse can also be a factor, as some people may regret signing up for certain services.
In some cases, people sign up to automatic recurring payment systems without even realizing it, and this can also lead to chargebacks and other issues. Chargebacks cause a lot of fees and extra work for banks and payment processors, so this is why it can be quite difficult to get the recurring billing merchant accounts you need.
So, what can you do if you run a business that offers products and services with recurring billing payments but you can’t find a bank to offer the recurring billing merchant account you need to operate your business? Well, even though there are many banks out there that may refuse to work with you, we can find one that will offer the merchant services you need.
At Shark Processing, we lead the way when it comes to high risk merchant accounts for businesses that have to handle a lot of high risk payment processing and credit card processing. We work together with an extensive network of trusted, reputable banks and payment processors all over the world who offer high risk merchant accounts to businesses like yours.
So, if you’re searching for a recurring billing merchant account, we can help you find it. We’ll assist you in getting your recurring billing merchant account open with the best possible rates and conditions, and we’ll provide expert-level support through the whole process. Give us a call today to find out more about how Shark Processing can help you with recurring billing merchant accounts.