A recurring theme in our business practice has been a search for a viable subscription billing service. At least several times a year we find ourselves diving into the minefield of payment gateways, processors and third party services to support a new product offering of our own or for a client project. In our most recent foray, I started out by telling our client that “handling recurring payments is at best a daunting subject, and in truth is most likely an utter quagmire.” Fortunately, we were invited to participate in early beta for the Seed Edition offering and found light at the end of the tunnel.
The basic concept of subscription billing is that you need to get a credit card processed on a regular basis … sounds simple right? Unfortunately, it’s never that easy. The payment processing world has layer upon layer of companies and services trying to get a small slice of every transaction, and a wide range of options, none of which are easily understood. Over the years, we’ve evaluated and tested dozens of possible solutions. Rather than name names or share horror stories, I thought it might help to provide a general overview of the world of subscription payments which should help convey the complexity of finding the right solution.
Credit Card Processing
There are many ways to get credit cards processed, including services designed mostly for web based transactions, but pretty much every bank and financial institution these days will happily process cards for a fee. Every processor has different fee structures and service offerings. Some processors won’t sell direct, such as Authorize.net, so you have to go through a processing reseller. Also, not all will support recurring payments and, even if they do, it’s likely a limited functionality offering with no management features.
Most credit card processors provide a payment gateway that allows you to process credit cards online or through an API if you want to programmatically post transactions. The main purpose of the Gateway is to securely pass credit card information to the processor. Not all Gateways are alike. Some are basically just set up to be websites that you can use in your office or home instead of a credit card machine. Others have the ability to be embedded in a website or passed into from a form post but may end up with a look and feel different from your product site.
Some processing services offer a gateway with recurring billing service that allows you to store a client credit card with a monthly amount and automate the processing. Others just allow storage of the credit card and then you manually have to submit the transaction each period. There are a number of services that will securely store credit card information and automatically send the bill to the processor on a regular basis … which is where Seed Edition comes in.
It’s very possible when designing an web application or shopping cart to store credit cards, navigate the maze of processing and gateway services and then set up some scheduled processes to run credit cards every month. Unfortunately, this is expensive, often unreliable and beyond the technical means of many smaller businesses.
Seed Edition makes the entire process extremely simple. PayPal and Authorize.net gateways are supported so you simply get the appropriate account and enter credentials in the Seed Edition setup interface. It’s then an easy process to create a subscription model, add clients with regular payment patterns and begin billing on a regular basis. For more advanced use cases, Seed Edition provides a robust API to automate account and subscription creation, and to generate payment inquiries. The user interface is simple for billing staff and powerful for reporting and management activities.