Guide to Auto Recurring Billing

Implementing an Auto Recurring Billing Program

If you currently accept payments electronically via direct-debit from a bank account, or via credit card, you can likely use your current payment processing system for auto recurring billing. The auto recurring program can be implemented in two ways: 1. Use the auto recurring billing functionality in your business management software (such as QuickBooks), and export a batch (daily, weekly, monthly) to a payment processing system. 2. Implement the auto recurring billing function in your payment processing program (note that some companies require an additional charge for this function.) If you don’t already accept electronic payments, you will need to subscribe to this type of service. The simplest way to do this to find a service that will enable you to perform ACH transactions using your current business bank account. This system will let you set-up an auto recurring billing program where you can direct-debit customer checking accounts for outstanding balances.

I recommend: PaySimple, a low-cost easy to use web-based payment processing system. It provides turn-key fully functional auto recurring billing as part of the base system.  PayPal enables auto recurring billing, but the user must program the system to make it work.  Authorize.net offers a fully functional auto recurring billing module, but charges extra for it.

Marketing an Auto Recurring Billing Program to Your Customers

Once you have processing capability in place, you can open the auto recurring billing program to your entire customer base. Many consumers know about these programs and are excited to sign-up for the new offering. Others need to be educated about the electronic payment process, and the benefits it can provide them. Note that you cannot enroll a customer in an auto recurring billing program without explicit permission. Each customer must provide you with bank account information and sign a form giving you permission to debit that account.

I recommend: Electronicpayments.org provides a wealth of information about electronic payment processing, and also provides materials you can use to educate your customers.

Most organizations introduce auto-recurring billing programs by sending a letter to the customer base, and asking them to sign-up for the program. A sample customer letter is available here.

When customers have signed up, you stop mailing them paper invoices, they stop mailing you paper checks and all billing and collections are handled electronically.