Recurring Payments for Small Businesses: What Should You Choose

7 Tips to Choose an Online Payment Provider for Your Business
(Last Updated On: November 18, 2020)

Here’s a riddle: what goes and comes in 364 days without the intervention of anything but time? Your birthday! Recurring payments are just like birthdays but with shorter or equal time spans. Is using recurring payments for small business a wise option? Let’s find out.

Understanding Recurring Payments

Today, the recurring payments model is hot property. Several businesses are taking up the subscription or membership model to launch their entrepreneurial journey. How is this model different from a regular business model?

While buying a normal product or service, you ideally pay for it at the time of purchase and you’re done. In a subscription/membership model, you allow the product/service provider to debit the purchase amount from your account at regular intervals in exchange for the product/service.

How Recurring Payments generally work:

  • A customer signs up or buys a product or service for an annual/monthly/weekly fee.
  • The customer enters Credit/Debit Card details while making the first payment.
  • The details are saved for the next purchase.
  • When time comes to renew the purchase, money is automatically debited from the customer’s account.
  • This is done at regular intervals. The customer need not make the purchase again.

Why Choose a Recurring Payments Model?

Recurring payments are a great way to keep the income flowing. However, it is important to ascertain if your business model is right for this plan.

Your product or service needs to work naturally with a recurring payments model. If you are creative enough, you can apply this to your small business as well.

Subscription models are relatively hard to build though. You would need to customize your product and your payment model according to customer needs. Recurring payments is also an expensive model for sellers as the fee involved is generally higher.

Recurring Payment Business Models

A membership or subscription business model generally works for services or utility-based products but the model can literally be applied to any business idea. Here are four ideas you could apply the recurring payments model to:

  • SaaS – Software as a Service: The most popular recurring payments business is SaaS. Companies like Adobe and Microsoft offer their product as a service for a recurring annual fee. All those gold, platinum and silver plans you choose to use an app or website – that’s a SaaS company making money on a recurring payments model.
  • Content – Running a blog or a newsletter? Paying for exclusive content in a magazine or news website? How about Hotstar, Netflix and Amazon Prime? This is also a popular recurring payment business model.
  • Utility Products – Right from makeup kits to razors, the subscription model works wonders for a utility products business.
  • Rentals – If you are in the rental business of letting a customer use a product/service for a period of time in exchange for a periodic fee, the subscription model is ideal for you.
  • Affiliate Sales Programs – This is a slightly different form of subscription model where you are typically a reseller of a service or product and in return receive a commission for every sale/client you add for the affiliate company. For example The Instamojo Channel Partnership Program.

If you are a software developer or know someone that is, you could refer them to the Instamojo channel partner program. This program not only lets you get started in minutes but also helps you earn a commission on every client transaction.

Ready to make money on the side? Become a partner today!


  1. Hey, I can’t find a way to set up recurring payments.
    Is there someone i should get in touch with to do this?

    1. Hello Frank,
      While Instamojo doesn’t yet support recurring payments/subscription payments, you can always become a channel partner with us and earn a commission on every sale your client makes.
      Please drop an email to and we’ll connect you with someone from the team. Cheers!

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