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A guide to setting up recurring credit card charges.

Inovio recurring paymentsIn your role as a consumer, you’re no doubt familiar with recurring monthly bills such as those you pay for utilities, your mortgage, and your cable or satellite TV provider. You may even have the amounts automatically withdrawn from your checking account without a second thought. There are good reasons to take this same convenience and reliability you experience as a consumer and transfer it to your small business and your own customers. The process is not as hard as you may think!

The advantages of offering recurring billing.

Recurring credit card payments offer benefits to consumers and entrepreneurs alike. Customers are given the flexibility and leeway to determine when to schedule their automatic payments without having to worry about forgetting a due date. By the same token, business owners gain a steady flow of cash that can be reliably predicted, while cutting down on those pesky late payments that can be so costly in terms of cash flow and the time it takes to chase them down. When payments are processed via customers’ credit cards, a merchant can also expect the funds to be dispersed more quickly. What’s more, approval is instant. Customers can often take advantage of card-sponsored rewards that provide an even stronger incentive to sign up for recurring billing.

Seeking out the right recurring billing solution.

If you’re convinced that pursuing this feature-packed and convenient option is right for you, your first step is to find the right software interface that will allow you to move forward. If you already have a merchant account, contact your provider to find out what options they may offer. Many payment gateway providers also extend recurring billing software packages to their ecommerce customers. Be sure that the one you choose includes features that allow you to arrange for one-time payments, manage your customer database, and seamlessly create and send invoices. If you don’t already have a merchant account, many of these solutions will offer this capability as well.

If your business uses invoices, you can choose an invoice-based recurring payment system that will charge a customer’s credit card every time an invoice is processed. In order to initiate it, a customer must furnish all relevant information and opt into automatic payments. From that point on, they will receive receipts each time an invoice payment is processed. This type of payment schedule is ideal for service providers, vendors such as gyms and schools that require monthly payments, and clubs and subscriptions. Many forms of online purchases also lend themselves to scheduled payments. These include subscription boxes, online courses, games, and mobile apps, just to name a few.

Spread the word.

Once you have your system set up and ready to launch, you need to let your customers know that you are now offering this attractive bill-paying feature. Many of them will quickly embrace this simple solution and be grateful that you have gone out of your way to make their payment process more streamlined. Consider including an article in a prominent place in your next newsletter. Bes sure to send out an email blast to your customers as well. After all, everyone will benefit from this great new payment option you’re offering!

Obtain customers’ payment information.

Now that you have a solution in place that will enable you to easily organize, track, and edit recurring credit card charges, you are ready to load it with the relevant information from your customers. In order to offset any fears that your buyers may have about security, explain that all of their sensitive credit card data will be encrypted and safely stored off-site in the cloud. If you already collect one-time payments from some of your customers, you may have their information stored in your system. For the rest, encourage them to upload their data into your billing system. You will then have an updated record of all their contact information, which is a definite plus when the time comes to send out a newsletter or promotional email.

Obtain authorization.

It probably goes without saying, but you should never begin withdrawing funds from a customer’s account without prior authorization. This authorization can be obtained in several ways: via email, phone, or in writing. Keeping credit card authorizations on file gives you proof that the timing, frequency, and amount of the payments have been agreed upon. At the same time, the authorization often sets the customer’s mind at ease since the schedule is clearly displayed in writing for later reference.

Get the ball rolling.

Now that you have the customer’s written or verbal permission, it’s time to get the recurring credit card payment schedule in place. In most cases, the software you obtain from your payment gateway providers or from another source will enable you to specify:

  • The recurring billing start date.
  • The frequency of payments.
  • The amount of first payment.
  • The number of subsequent payments.
  • The anticipated end date.

Once you have specified all of these fields, both you and your customers will have a clear idea of the entire payment structure from start to finish. As a business owner, this enables you to predict incoming cash flow. At the same time, your customers can have a firm idea of how much they will be spending, how often withdrawals will occur, and when the payments will come to an end.

Most likely, you appreciate the ease and convenience of recurring payments in your own daily life. Isn’t it time to afford the same flexibility to your valued customers? Get paid again and again — start accepting recurring customer credit card payments today