How to Accept Recurring Payments With 7 Top Payment Processors
Meaghan has provided content and guidance for indie retailers as the editor for a number of retail publications and a speaker at trade shows. She is Fit Small Business’s authority on retail and ecommerce.
Anna is a retail expert writer for Fit Small Business with over six years of evaluating dozens of software for small business. She holds a double degree in Accountancy and Financial Management and is currently pursuing further education in financial and payment technology.
This article is part of a larger series on Payments.
A recurring payment—also referred to as a subscription payment, recurring billing, or automatic payment—is an electronically processed payment that repeats according to a preset schedule. Businesses often set these up to collect fees for memberships, subscriptions, lessons, and services. The recurring payments process also requires customers to sign a one-time authorization form.
The easiest way to accept recurring payments is with an all-in-one payment processor or merchant account that handles the payments but also has software to manage the billing process and security features to protect your customers’ information. Learn more about merchant accounts.
The best payment processors for recurring payments are:
- Helcim: Best overall recurring payment platform
- Square: Best for small businesses needing a free POS system
- PayPal: Best invoice and subscription solution for online businesses
- Wave: Best (and free) recurring invoicing and accounting software for individuals
- Stripe: Best for online startups managing international or in-app payments
- Stax (Formerly Fattmerchant): Best traditional merchant account for recurring billing
- PaySimple: Best all-in-one platform for managing subscriptions and memberships
Select a processor below for specific details on how to set up recurring payments:
Helcim: Best Overall Solution for Accepting Recurring Payments
Overall Score:
4.55 / 5
Pros
- Volume-based interchange-plus pricing
- Built-in invoicing and recurring billing tools
- Customizable customer portal
Cons
- Limited back-office integration
- Not ideal for low-volume merchants
- Reports of poor customer support
What we like:
Helcim offers a fairly extensive set of tools for businesses of all sizes for a very competitive price that includes recurring billing and subscription management software at no extra cost. You can create customized quotes, set up unlimited subscription plans with customized pricing and add-ons, and track your receivables from your Helcim platform. While Square also offers a free invoicing tool with recurring options, it lacks Helcim’s subscription management and customer-facing portal features.
Helcim Recurring Payment Features
- Monthly fees: $0
- Recurring billing/invoice fee: $0
- Card-not-present fee and card-on-file: 0.2% + 10 cents to 0.5% + 25 cents
- ACH fee: 0.5% + 25 cents
- Chargeback fee: $15 refundable
- Payments accepted: Credit and debit cards, ACH, Apple Pay, and Google Pay
- Multiple invoice types: Estimates, recurring invoices, card-on-file recurring billing, progress-based invoices, and multi-package invoices
- Automated features: Automatic charging based on customer’s stored payment information, payment reminders, and auto card update
How to Set Up Recurring Payments With Helcim
Helcim provides its users with detailed guidance on how to use the platform, including subscription management. It starts with creating a subscription plan, followed by adding a subscriber to a plan either manually or through an invoice.
Creating a Subscription Plan
Creating a Recurring Invoice
Manually Adding a Subscriber
Square: Best for Small Businesses Needing Free POS
Overall Score:
4.41 / 5
Pros
- Free iOS and Android app
- Automated payment reminders
- See when an invoice has been viewed
Cons
- High card-on-file processing fees
- ACH only for single payment invoice
- Custom rates available
What we like:
Square is a top-rated retail point-of-sale (POS) system that covers every base when it comes to accepting credit cards—including recurring payments. It offers affordable pricing, free software for billing, invoicing, virtual terminal, stored payments, and an online store. Square also provides a free payment authorization template for businesses implementing recurring payments.
While it now accepts ACH payments, this is limited to single invoice transactions. That said, Square’s affordable pricing, zero chargeback fees, free software for billing, invoicing, virtual terminal, stored payments, and online store, still makes Square our top choice for small retail businesses that also need a free POS.
Square Recurring Payment Features
- Monthly fees: $0
- Invoice monthly fee: $0–$20
- Recurring Billing and Card-on-file processing fee: 3.5% plus 15 cents per transaction
- Invoice fee: 2.9% + 30 cents per transaction
- ACH processing fee: 1% per transaction, minimum $1
- Chargeback fee: $0
- Payments accepted: Credit and debit cards, Apple Pay, Google Pay, and Square Pay
- Multiple invoice types: Estimates, recurring invoices, card-on-file recurring billing, progress-based invoices, and multipackage invoices
- Automated features: Reminders for upcoming and overdue payments
How to Set Up Recurring Payments With Square
Square’s PCI-compliant payment system allows your customers to store their credit card information as a card-on-file in Square’s secure payments vault. Customers can enter this information via a link from your emailed invoice, or you can enter this on their behalf using your Square POS system or the virtual terminal in your online dashboard.
Recurring payments are triggered by Square’s invoicing function. When invoices are run—either individually or in a batch—any card-on-file customer payments are automatically charged. Customers are then notified of the payment via email with a “paid” invoice receipt.
Scroll through the images below for more details:
The entire process is quick and requires minimal setup or ongoing management. Being invoice-based, Square’s recurring payments make it easy to process regular payments plus add-on charges as needed. Added fees can be entered as a separate invoice or combined with regular recurring charges—whatever fits the billing need.
Visit our step-by-step guide to sending Square invoices for more information.
PayPal: Best for Online Businesses
Overall Score:
4.04 / 5
Pros
- Accept PayPal payments
- Accept partial payments
- Convenient mobile app
Cons
- Monthly fee for subscriptions
- ACH and card-on-file payments only available through Braintree
- Not the best for multichannel businesses
What we like:
PayPal is one of the best ways to accept credit card payments online, and it’s easy to manage online payment automation via online invoicing, email marketing, and website sales. It can be used to bill customers for online memberships and subscriptions—a feature which Square lacks—and gives faster access to your funds with a PayPal balance.
The ability to accept PayPal and PayPal Credit payments makes this provider stand out. However, its recurring payments feature will cost you at least $10 per month. ACH and card-on-file processing are only available through PayPal’s Braintree, which requires a different account and application.
PayPal Recurring Payment Features
- Monthly fees: $0
- Virtual terminal (Payflow) fee to process invoice and recurring payments: $10–$40/month ($10 plus optional $30 for recurring payment tool)
- Invoicing/recurring payment processing: 3.49% plus 49 cents per transaction
- ACH processing: 0.75% capped at $5
- Chargeback fee: $20
- Payments accepted: PayPal payments, PayPal Credit, Venmo, credit and debit cards, eWallet payments
- Automated features: Sends reminders and payment notifications and automatically retry failed transactions
How to Accept Recurring Payments With PayPal
There are two main ways to accept recurring payments with PayPal: invoices and subscriptions. Either way, the first step to accepting recurring payments is by opening a free PayPal business account. PayPal also provides lower fees for nonprofits, which can be helpful for nonprofits setting up a subscription donation program.
Creating a Subscription in PayPal
When creating a subscription, you’ll need to enter the type of product or service and choose how you want the subscription billing cycle to work—subscribers can pay the same rate each cycle or a variable rate based on the quantity of a product.
You’ll then create a subscription plan description and set pricing and tax settings. You can also choose to add on a setup fee. Then, choose how to bill customers, pick payment frequency, and set free trials. After you’re done setting up the product and pricing information, you can add “Subscribe” buttons to product pages, blog posts, and marketing emails.
Scroll through the images below for more details:
Setting up PayPal Recurring Invoices
You can create, send, and manage recurring invoices with a PayPal Business account. From the user dashboard, create a new invoice and select a recurring option under the “Frequency” dropdown. You can create and save contacts, products, and services. Plus, you can add your business logo and information for a more professional look.
After adding recipients and products, choose tether to allow partial payments and tips. Add any relevant notes (like shipping or return information) and attach files, such as work orders or estimates.
Most online customers regard PayPal as one of the most trusted ways to process online credit card payments. Read our guide on how to accept credit card payments online.
Wave: Best Recurring Invoicing for Individuals
Overall Score:
3.81 / 5
Pros
- No monthly fee; has free invoicing and accounting software
- Low-cost ACH processing
- No additional fees for card-on-file or recurring payment transactions
Cons
- Slower, two-day payout time
- No phone support
- Higher fees for American Express transactions
What we like:
Wave is a free, user-friendly invoicing and accounting software that can also be used to set up recurring invoices and payments. It allows you to switch between card-on-file payments or opt to send automated invoices that customers can pay manually. We can see Wave as a great invoicing tool for individuals, as even small businesses could quickly outgrow the limited-feature platform.
Its free invoicing tools and accounting software with reporting for payments, payroll, taxes, and cash flow gives Wave its advantage over other payment processors. However, it lacks virtual terminal functionality and only offers limited customer support hours.
Wave Recurring Payment Features
- Monthly fee: $0
- Credit card processing fee: 2.9% + 30 cents
- American Express processing fee: 3.4% + 30 cents
- ACH / bank payment fee: 1% ($1 minimum)
- Chargeback fee: $15
- Automated features: Payment receipts, past-due reminders, send out recurring invoices, charge clients based on a set schedule, and invoices sync with accounting
- Mobile app: Invoicing and receipt scanning app for iOS and Android
How to Accept Recurring Payments With Wave
The first step for accepting payments with Wave is to create a free Wave account. Once you’re signed up, you can choose to create individual invoices, or set up a recurring invoice, including options to save your customers’ payment information. There are also options to build payment plans.
From the dashboard, you can see at-a-glance invoices that are past due, outstanding, unsent, or upcoming and when your next payout is. Like Square and PayPal, Wave can also be used to create and send estimates that can then be converted into invoices.
Stripe: Best for International & In-app Payments
Overall Score:
3.80 / 5
Pros
- ACH payments and local currency options
- Sophisticated billing logic
- International, ACH payment, and local currency options
Cons
- Takes longer to set up and requires technical skill to maintain
- In-app payment features require coding
- Limited CRM and virtual terminal features
What we like:
Stripe is a leading online payment processing solution and major competitor of PayPal in general. It delivers excellent recurring payment options for online subscription sales, online blogs, e-learning memberships, and online invoicing. This developer-friendly solution has open-source code and plenty of toolkits and APIs.
Stripe offers an impressive array of language and currency options for international payments and plug-and-play solutions that can work with any website. However, it offers limited CRM tools and charges a fee for recurring billing transactions. The system can also be tricky to set up and maintain, which may require technical skills.
Stripe Recurring Payment Features
- Monthly fee: $0
- Card-not-present processing fee: 2.9% + 30 cents per transaction
- Keyed-in processing fee: 3.4% + 30 cents per transaction (for first-time recurring payments and card-on-file)
- ACH debit payments: 0.8% capped at $5
- Recurring payments service fee: 0.5%–0.8% per transaction
- Chargeback fee: $15
- Payments accepted: Credit and debit cards, e-wallet, ACH, echeck, and over 135 currencies
- Flexible billing logic: Charge per seat, metered pricing based on use, multiple membership options, pricing tiers, flat rate, and flat rate plus overage charges
- Automated features: Payment and past-due reminders, card updater for new numbers and expiry dates, retry failed payments, membership renewals, and prorated billing
How to Accept Recurring Payments With Stripe
Stripe recurring payments can work with most ecommerce platforms and blog sites. In fact, many online subscription box marketplaces like Cratejoy seamlessly integrate with Stripe as their primary payment solution.
Using Stripe, you can quickly attach subscription payments to most ecommerce platforms using its automated integrations. Or, you can create pop-up membership or subscription forms that easily embed in your blog or website pages, and even in emails and online apps.
Like the other online recurring payment solutions on our list, Stripe saves your customer’s payment data in their PCI-compliant virtual vault to ensure security. Plus, Stripe can send e-receipts to notify customers that their automated payment has been successfully processed.
Stax: Best Traditional Merchant Account
Overall Score:
3.75 / 5
Pros
- Customers can pay invoices via email and SMS text
- Automatically update customers’ expired and changed card numbers
- Wholesale payment processing rates
Cons
- High monthly fees
- Not a good fit for small or occasional sales
What we like:
Stax is different from the other payment processing providers on this list in that it offers subscription-style payment processing services. With it, you pay more upfront, but if you are a high-volume business, you’ll pay less overall per transaction. Helcim and Stripe cater to similar users, but Stax gives you a better handle on the total you pay for payment processing upfront so you can predict your expenses more accurately month over month.
Stax can accept a lot of payment types and has excellent software solutions for managing recurring payments, including billing, subscriptions, and invoicing.
Stax Recurring Payment Features
- Monthly fee: $99–$199
- Card-present processing: Interchange plus 8 cents
- Card-not-present processing: Interchange plus 18 cents
- Chargeback fee: Not disclosed
- Payments accepted: Credit and debit cards, ACH, and echeck
- Automated features: Automatically charge customer payment information stored on-file according to pre-set schedules, send payment reminders, update expired card information, and sync with QuickBooks accounting
How to Accept Recurring Payments With Stax
Setting Up an Invoice Through Stax Pay
Stax Pay is Stax’s payment processing service for small businesses. When setting up an invoice or recurring payment, you have the option to create a single invoice or a recurring transaction. If you want to set up a recurring payment or invoice, simply navigate to the invoice tab in the Stax Pay dashboard. From there, you can create a new invoice, enter the price you want to charge, and specify the invoicing or automatic payment frequency schedule for clients with their card on file.
You have the option of sending recurring invoices that customers will need to click to pay or storing payment information on file and automating payments according to the set schedule.
Sign Up for Stax Bill
Stax Bill is a cloud-based platform designed to simplify subscription billing management by automating your manual accounting and financial processes. Larger B2B SaaS using subscription-based business models can benefit from Stax Bill’s scalability to customize and automate everything from product management to revenue recognition accounting methods. This allows merchants to have more time to focus on running their growing business instead of managing accounts receivables. Monthly fees start at $199/mo.
Stax Bill Features include:
- Subscription Offering
- Accounting and Revenue Management
- Catalog Management
- API Integrations
- Invoicing and Recurring Payments
- Self-Service Checkout Site (Online Payments + Sign Up)
- Customer Facing Portal
- Message Customization
- Advanced Analytics + Custom Reporting Dashboards
- Security + Compliance
PaySimple: Best for Subscription & Memberships
Overall Score:
3.56 / 5
Pros
- Membership and other automation features
- Customize secure online sign-up forms
- Good customer support
Cons
- Tiered (unpredictable) processing fees
- Monthly subscription fee
- Does not accept PayPal payments
What we like:
PaySimple is a full-service platform with particularly strong membership, subscription, order, event, and booking management features, which you won’t find in Helcim and Square except via API or additional paid integrations. With it, you can create your own secure online sign-up forms, set up unique customer portals, and build a standalone membership site.
Unlike other providers in our list, PaySimple follows a tiered pricing model, which we don’t usually recommend—however, its subscription and membership features make it a viable option for this particular use case.
PaySimple Recurring Payment Features
- Monthly fees: $79.95
- Recurring payment processing fee: Starting at 2.54% per transaction (rates will vary)
- ACH and echeck processing fee: 0.25% + 69 cents per transaction
- Card on file service fee: $5 per month
- Chargeback fee: $25
- Payments accepted: Credit and debit cards, e-wallet payments, ACH, echeck
- Automated features: Automatically charge using stored customer payment information, send payment reminders, and update expired credit card information
How to Accept Recurring Payments With PaySimple
Recurring payments is a built-in feature of PaySimple’s online sales platform. With PaySimple, you get an array of online tools that let you accept and manage all sorts of customer registrations, memberships, and subscriptions. It also provides robust booking management tools, complete with prepayments and deposits.
Recurring payments can be initiated by your customer via online forms on your PaySimple registration or membership website. Or, you can create them yourself in the PaySimple dashboard on a customer’s behalf using the Manage Recurring Payments tab.
In the PaySimple dashboard, you can set up repeat billing schedules, manually process or refund payments, and manually initiate or cancel subscriber accounts. PaySimple will even prorate monthly billing amounts automatically.
How We Evaluated Recurring Payment Processors
The best recurring payment processor for you will really depend on the size of your business, the type of products or services you sell, and whether they require invoicing, subscriptions, memberships, or something in between.
For this guide, we evaluated recurring payment processors based on general pricing (including transaction fees and overall pricing transparency), the types of recurring payments they can handle, and general features like customer support and payout times. Plus, we considered the overall value each system offers, how easy it is to use, customer reviews, and our personal experience interacting with the product and customer support teams.
Click through the tabs below for our detailed evaluation criteria.
20%
Pricing & Contract Terms
30%
Recurring Payment Types
30%
General Features
20%
Expert Score
20% of Overall Score
We prioritized payment processors that don’t require monthly minimums, contracts, and monthly fees. We also awarded points to solutions that have no or minimal chargeback fees, which can be especially important for subscription and membership-based businesses.
Square performed the best here, earning a perfect score because of its lack of monthly, cancellation, and chargeback fees. Helcim, Wave, and Stripe tied in second only losing points for chargeback fees. PayPal came in third with 4 out of 5 points while Stax Pay trailed behind. PaySimple earned the lowest score because of its tiered pricing model.
30% of Overall Score
Stax Pay, Helcim, and PaySimple all earned a perfect score here. Square fell slightly behind, as it can only accept ACH payments through invoicing. Stripe also was slightly behind, as its virtual terminal solution is meant to be used only in case of emergency. Wave came in third because it does not offer a virtual terminal. PayPal came in last here because recurring ACH payments and card-on-file transactions are only available through its Braintree solution.
30% of Overall Score
Cash flow is important to small businesses, so we awarded points to solutions with same- or next-day payouts. We also prioritized 24/7 phone support and tools and gave extra points for those that offer customer portal features on top of being able to manage customer accounts. Recurring card-on-file payments also require customers to sign a payment authorization form, so we looked at whether each processor offers a template or has this feature included.
Only Helcim scored above 4 in this section. Square earned a 3.75 out of 5 for general features with CRM tools and payment authorization forms. Except for Stax Pay, all companies have limited-hour phone support, and while none of these solutions offer free same-day payouts, we gave extra points for PayPal’s ability to give immediate access to funds with PayPal balance. However, all except for Stripe can offer free next-day payouts in certain scenarios.
20% of Overall Score
In general, payment processors should offer transparent, predictable pricing. We considered any standout features and the overall value each system offers for its price. Finally, we took general account stability, ease of use, and user reviews into account.
All companies performed well here, with the exception of PaySimple, which earned a 2.75 because of its complicated and opaque pricing structure. Wave also only earned a 3.56 in this area because its feature set is rather basic, though the company is regularly adding new tools, so this evaluation may change.
*Percentages of overall score
How Do Recurring Payments Work?
No matter which processor or invoicing solution you choose to manage recurring payments, the basic steps are the same: customers enroll in a subscription or recurring billing invoice, and you bill them at designated intervals. Ideally, you will save the customer’s payment information on file, so the charges are automated.
Most businesses that offer memberships, subscriptions, and recurring invoicing also set up options for automatic payments. This requires saving customer credit card information which requires an authorization form. Learn more about credit card authorization forms.
How Much Does It Cost to Accept Recurring Payments?
Recurring payment processing fees are typically a small percentage of the transaction total. Each payment provider sets its credit card processing fees; some tack on monthly account fees.
For example, Square charges 3.5% plus 15 cents per recurring payment, so a $100 charge costs $3.65 in fees. With Square, that’s all you’ll pay because Square has no other account fees. In contrast, Stax and PaySimple both charge monthly fees for recurring payments—but both providers have lower per-transaction fees for accepting credit card payments.
You’ll also want to consider other payment processing services or perks that these providers offer. Value-added benefits, such as Square’s free business management suite or PaySimple’s event booking management features, might be the deciding factor. Read our guide on credit card processing fees.
Costs of Accepting Recurring Payments With Our Recommended Processors
Application | Monthly Account Fees | Invoice/ Recurring Payments Service Fee | Recurring Payments Transaction Fee | ACH Transaction Fee | |
|---|---|---|---|---|---|
| Virtual Terminal | $0 | $0 | 0.2% + 10 cents to 0.5% + 25 cents | 0.5% + 25 cents |
| Square Invoice | $0 | $0–$20 | 3.5% + 15 cents | 1% (minimum $1) |
| Payflow | $0 | $10–$40 | 3.49% + 49 cents | 0.75% capped at $5 (Braintree) |
| Wave platform | $0 | $0 | 2.9% + 30 cents (+ 0.5% for AmeEx) | 1% ($1 minimum) |
| Stripe Billing | $0 | 0.5%–0.8% (recurring) | 2.9% + 30* cents | 0.8% capped at $5 |
| Stax Pay/ Stax Bill | $99/ From $199 | $0 | Interchange + 18 cents | Not disclosed |
| PaySimple Recurring Billing | $79.95 | $5 (for Card-on-file) | 2.54% | 0.25% + 69 cents |
*Stripe charges a keyed-in processing fee of 3.4% + 30 cents per transaction for first-time recurring payments and card-on-file
Who Should Use Recurring Payments
Invoice-based recurring payments are ideal for:
- Service providers: Lawn care, house cleaning, personal training, and childcare can process automatic repeat payments via single or batch invoices.
- Monthly tuition or lesson fees: Fitness clubs, music lesson providers, dance studios, and tutoring businesses can run invoices and automated payments on a monthly basis.
- Subscription services or club sales: Wine-of-the-month clubs and store loyalty programs can use recurring payments to automate monthly club sales or fees.
Online recurring payment solutions are ideal for:
- Subscription box businesses: Subscription box sellers use online websites and marketplaces to sell subscriptions, then automatically run recurring charges for subscribers before shipping scheduled boxes.
- E-learning academies: E-learning businesses make online course content and instruction accessible on an ongoing basis via an online checkout with scheduled recurring payments.
- Membership blogs with restricted content: Informational bloggers can manage access to members-only content using recurring membership payments.
- Online services: Recurring payments are what make all types of online services possible, including software as a service (SaaS), online advertising, gaming products, virtual service providers, and mobile apps.
If you’re selling anything online that auto-renews or requires periodic automatic payments, you’ll need a payment processor that can handle the recurring transactions. The easier you make it for customers to pay you, the better.
How Your Business Benefits From Recurring Payments
There are two huge benefits to setting up a recurring payment model for your business:
- Saves time: Instead of manually setting up invoices or calling customers for payment, automatic billing can save hours of your or your employees’ time every billing cycle.
- Offers predictable revenue: Membership and subscription models offer businesses a more stable revenue stream than ad-hoc billing, as it’s easier to predict revenue when you know how much customers will pay in advance.
All the benefits are not just for businesses. Customers enjoy the convenience of a set-it-and-forget-it payment option, which is especially ideal for necessities or services they use consistently and would not want interrupted service on.
Recurring Payments Frequently Asked Questions (FAQs)
What are recurring payments?
Recurring payments are multiple automated payments received by merchants at regular intervals. Customers provide merchants with a written authorization to save their card on file and pull funds from the customer’s bank according to the agreed amount and schedule.
How to manage recurring payments?
To manage recurring billing, recurring payments, or automatic payments, you need a billing software or application that allows you to create invoices, set up a recurring billing schedule, and track the progress of each payment. You may also want to consider using a payment processor with a built-in recurring billing feature in order to efficiently manage transactions from a single platform.
The providers on our list are some of the best payment processors in the industry with native recurring management tools.
What are examples of recurring payments?
Recurring payments are automatically repeated transactions, so this payment method is most useful for memberships and subscriptions. Customers authorize the merchant to save their credit card information for future use. Examples of recurring transactions include online learning subscriptions like Coursera and even memberships to charitable organizations like UNICEF.
Retailers that offer subscription boxes like wineries also use recurring billing as a primary payment method. (Source Square)
What's the difference between automatic payment and recurring payment?
Automatic payments can be any type of transaction pre-authorized by a customer—meaning the customer has allowed the merchant to save their credit card information and customers only need to confirm their purchase to be charged for a transaction. Credit card holders often set up automatic payments to pay for their credit card bill.
Meanwhile, a recurring payment is a type of automatic payment method where the customer authorizes a merchant to charge the former’s bank at regular intervals, often for the same amount, such as that of monthly subscriptions and payment plans.
What is recurring billing?
A recurring billing arrangement is when a billing invoice is set to be sent to customers at regular intervals. These digital invoices are also embedded with a checkout button where customers can proceed with making a payment and even sign up for automatic payments.
Bottom Line
Based on our evaluation, we recommend Helcim as the best overall recurring payment processor for most small businesses. Affordability and flexibility are the key reasons Helcim tops our list for the best recurring invoice payment provider. A free Helcim account includes card-on-file payments, invoicing software with automation tools, a sleek customer portal, and a mobile app to accept payments online or in person.
