When it comes to running a subscription program, your technology truly has the potential to make or break your business. With the rise of subscription-based models comes an increasing need for merchants to have the right tools in place to streamline their operations and build unforgettable customer experiences. 

Yet, our recent study shows that the vast majority — a staggering 97% — of merchants have faced technological roadblocks of some form. Among the most prevalent are issues surrounding security, fraud, and compliance — a critical area that, if mismanaged, can lead to customer loss, legal repercussions, and stalled growth. 

Security, fraud, and compliance: A top challenge for 46% of merchants

Nearly half of all merchants (46%) report facing obstacles with security, fraud, and compliance. With the rise of fraud and changes in regulatory requirements, today’s subscription businesses must be vigilant in protecting customer data and complying with strict legal standards. Especially for merchants looking to expand into global markets, compliance with frameworks like PCI DSS (Payment Card Industry Data Security Standard), GDPR (General Data Protection Regulation), and other governing regulations is critical.

By failing to stay up-to-date with these regulations, businesses remain vulnerable not only to potential data breaches, but also risk losing customer trust and damaging their brand reputation. Needless to say, managing these risks is key to building long-term subscriber loyalty and ensuring a successful expansion into international markets.

How to overcome security, fraud, and compliance issues

Now more than ever, merchants have a responsibility to safeguard customer information and payment data. However, this can become increasingly complex as merchants scale across borders. In order to effectively address security, fraud, and compliance issues, subscription businesses must plan strategically and have the right tools in place. 

Here are four solutions that can help your business navigate these challenges:

Use a PCI DSS-compliant billing system. 

Ensuring that your billing method is PCI-compliant is one of the first steps in safeguarding customer payment information from potential fraud. And with billing system customization, you can adapt security features to your unique needs, providing enhanced protection while ensuring smooth transactions.

Adhere to GDPR and SCA requirements.

For merchants with European customers, GDPR compliance is mandatory to protect customer data privacy. Additionally, the PSD2 regulation mandates Strong Customer Authentication (SCA), adding another layer of security to payment processes, reducing fraud, and ensuring that your transactions meet local and international standards.

Invest in fraud prevention policies and cybersecurity software.

Comprehensive fraud prevention policies and the right cybersecurity software are crucial in detecting and mitigating risks before they escalate. Fraud prevention tools, like Kount, can help your business detect suspicious activities, reducing the likelihood of fraudulent transactions that could damage your brand.

Implement a subscription management solution.

According to our studies, 61% of companies have adopted subscription management and billing solutions to tackle tech obstacles such as automating compliance tasks and streamlining operations across regions. Using subscription billing automation, these tools can help eliminate manual processes, allowing your team to focus on higher-value tasks while reducing the chance of human error in compliance and data-handling.

Success story: Sittercity tackles fraud with Recurly

Take Sittercity, for example. A digital subscription platform that connects families with in-home care providers, Sittercity initially relied on a homegrown subscription billing management platform. However, as the businesses grew, so did its need for a more robust solution — enter Recurly.

In 2015, when Sittercity ran a promotion for free first-month access to their platform, it saw a spike in fraudulent sign-ups. Luckily, Recurly’s partnership with a leading anti-fraud solution enabled Sittercity to quickly reduce fraudulent signups by 70%, allowing its team to focus on growth without sacrificing revenue or customer trust.

Want to learn more about overcoming tech challenges? 

The subscription industry is more saturated than ever, and merchants that fall behind on security, fraud, and compliance risk losing customers and revenue. By investing in a robust subscription compliance solution, businesses can navigate these challenges with ease — all while enhancing retention and creating a memorable customer experience.

Download our comprehensive guide, Get Ahead of Tech Trouble: Overcome Tech Obstacles and Retain Customers, created in partnership with Hanover Research, for more in-depth insights on tackling today’s biggest tech challenges and equipping your business for what’s next.