Do you need a subscription and recurring billing service?

Samir Yahyazade
Axel Springer Tech
Published in
3 min readFeb 13, 2022


What is a subscription?

A subscription is when end-users purchase products with recurring payments: either monthly, annually, or any term they choose. Such products can include newsletters, premium articles on websites, project management tools, CRM, and others.

How to sell subscriptions?

Currently, startups and small companies typically prefer to use 3rd-party services to provide subscription products.

There are two categories of 3rd-party providers

The first category includes payment gateway systems, such as Stripe, Bolt, Square, and Paypal, all of which can handle recurring subscriptions.

The second category represents 3rd-party intermediaries, such as Chargify, Recurly, Fusebill, and Paddle.

As noted in the above graphics, there is a big difference between the two categories. The first is a direct payment gateway that processes payments autonomously with payment providers such as credit cards and banks. The second category still requires utilizing the first category’s services in order to charge customers recurrently, i.e. it allows these 3rd-party intermediaries to support multiple payment providers. In this context, if you want to support processing credit cards and Paypal, it is not possible if you are using Stripe, as both companies are competitors and work against each other.

Moreover, there is another problem: you are always obligated to use these intermediaries’ services. You do not own any data and you will need to do all other integrations in order to process data and store it in relevant services internally.

How can we improve this situation?

Instead of using 3rd-party services, it is possible and preferable to create and use your own internal tool, which will process data and charge customers recurrently. This allows you to own and process data in real-time without waiting for any 3rd-party service to provide the data that you need. Since all data is owned and processed internally, it will be easier to normalize and create reports required by stakeholders.

As you can see from the above diagram, this flow is fairly simple and easy to manage. You could:

  • support multiple payment methods at the same time,
  • customer information can be synchronized between multiple services without interrupting user flow,
  • store credit card and customer information in multiple services,
  • deprecate any payment provider at any time,
  • support payment processors such as new cryptocurrencies, which is not currently supported by any service
  • long term, build your own payment processor that can be used to process credit card payments,
  • own promo codes, promotions, and integrations such as swag and rewards,
  • make integrations with any service without the hustle,
  • create white-labeled email designs and templates to be managed internally

Any risks?

The primary concern is the potential risk to bill incorrect recurring charges or duplicate charges. In this case, any system will also have to manage cancellations, refunds, and/or disputes, in addition to reporting capabilities and relevant dashboards.

My opinion

This seems like a valid concern, but from what I have learned throughout my experience, engineers were able to manage the risks and still see a good result. Further, since the engineers are involved in building these services, they will understand and learn how these systems work, while gaining experience for their future careers.