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Best practices for recurring and subscription payments | Ayden

By Ayden

How to optimize your recurring billing to maximize card authorizations for signups and subsequent payments.

We talked to some of the world’s leading subscription and recurring companies to find out how they approach payments for maximum growth.

We learned that, if you have a carefully planned and executed payments strategy, you’ll deliver a better customer experience, increase retention and ultimately grow your revenue.

Based on our findings here are the key best practices:

Validate card details at signup

A $0 or $1 authorization is a way to ensure that a card is valid before an actual transaction is made. The simplest way to explain how it works is as a preauthorization.

No money is actually deducted from the customer account, and it is carried out before charging a real transaction.

Where possible, we recommend a $0 authorization. Some customers don’t understand why a $1 charge appears on their account – even though it is not actually deducted. But, not all issuing banks accept $0 authorizations. Use the amount that the issuing bank prefers to achieve the highest authorization rate.

If you validate your customer’s card details at the point of sign-up, it’s more likely the next payment will be successful.

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About Ayden

The Adyen platform enables merchants to accept payments in a single system, enabling revenue growth online, on mobile devices and at the point of sale. Adyen was founded in 2006 by a group of entrepreneurs, including Pieter van der Does and Arnout Schuijff. The existing payments technology consisted of a patchwork of systems built on outdated infrastructure. With the aim of helping businesses grow, the co-founders set out to build a platform capable of meeting the rapidly evolving needs of today’s fast-growing global businesses.

SOURCE: https://www.adyen.com/blog/best-practices-for-recurring-and-subscription-payments

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