Examples abound of businesses large and small moving to a subscription model. From airlines and law firms to business models like OTT and IoT, the subscription business is decidedly booming.

In addition to an agile, scalable, and reliable recurring billing solution, new subscription businesses also need a payment gateway to process their recurring payments. Choosing the right payment service provider (or PSP — this term includes both payment gateways and payment processors) can be a daunting task, and getting it wrong can mean more than just annoyance and frustration. It can also mean lost business and lost revenue if the PSP doesn’t provide the key features required for your business to succeed.

Here are some of the major criteria merchants need to consider when choosing a PSP:

Does the PSP support the countries and the currencies where you do business?

Some PSPs only support transactions in certain countries or transactions in certain currencies, limiting a merchant’s e-commerce opportunities. Merchants should choose a PSP  that supports the countries and currencies where they expect to do business.

What can a merchant expect in terms of the onboarding experience?

Not all PSPs  are created equally. Some of the things merchants should inquire about when considering a PSP are:

  • How quickly are they able to onboard new merchants?


    Ask them how many days on average it takes to go live and what’s involved in setting up a merchant account.

  • What kind of self-serve tools do they provide, and what capabilities do those tools have?


    Great customer service is a must-have, but the ability to self-serve can be a huge plus. Merchants should have that option when they have a simple question or need some basic information.

  • Do they have relationships with the appropriate banks?


    Most merchants have an existing relationship with a bank and prefer to maintain this relationship. If a merchant wants to switch PSPs or expand their business to new countries, they should determine whether the PSP supports their current banking relationship

How reputable is the provider and how reliable is their service? What kind of SLAs do they offer?

If a PSP has an outage, merchants can’t process transactions and may lose customers. Merchants should ensure they have a clear understanding of the PSP’s system reliability, SLAs, and how well they’re equipped and prepared to address service interruptions so that they can resume processing payments as quickly as possible.

What does their service cost? What additional fees do they impose? What are their terms of service and other contractual requirements?

Price is obviously a consideration in any business relationship, balanced  by quality of service. Fees are another important consideration in picking the right PSP. Different PSPs will have different fee structures which can include monthly fees, fixed fees per transaction, variable fees based on the transaction amount, and extra fees for things like chargebacks, international payments and currency conversions. Merchants should get a quote from several PSPs to determine estimated costs based on the PSP’s fees relative to the merchant’s business.

Lastly, In the event of a change in requirements, are you able to switch providers smoothly? Business requirements, PSP policies, the payment processing ecosystem, and even your customers’ preferences are all subject to change. In the event your PSP can’t keep up with your business needs, are you able to switch providers without impacting your ability to bill and collect revenues?

These are some of the key things to consider in terms of researching and selecting a PSP and getting up and running with them. In subsequent posts, we’ll cover additional questions such as technologies that support integrations, payment collection options, and how different PSPs can impact your business’ ongoing operations.  

To see which PSPs Recurly supports, visit our website.


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