Recurring billing

What is recurring billing?

Recurring billing is a payment method where customers are automatically charged at regular intervals, such as weekly, monthly, or annually, for ongoing access to a product or service. It’s a core feature of subscription-based businesses and helps ensure continuous service without needing customers to take action each time.

With recurring billing, customers give permission once, and future payments are processed automatically. This system improves convenience for both customers and businesses, reduces missed payments, and helps maintain predictable revenue.

Types of recurring billing

• Fixed recurring billing – A consistent charge amount at every billing cycle (e.g., $20/month).
• Variable recurring billing – The amount changes depending on usage or services rendered (e.g., utility bills).
• Hybrid billing – A combination of fixed base fees with variable components (e.g., base + add-ons).

Why use recurring billing?

• Predictable cash flow
• Enhanced customer retention
• Simplified payment collection
• Reduced administrative work

Example of recurring billing

A streaming service like Netflix charges users a fixed fee every month until the subscription is canceled. This is a classic example of fixed recurring billing.

Driftcharge Tip

Make it easy for customers to manage or cancel their subscription. Transparent billing builds trust and reduces churn in recurring revenue models.

Ganesh Pawar

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Ganesh Pawar is the founder of Driftcharge, a subscription management app designed to help Shopify merchants streamline and scale their subscription businesses. With a deep focus on solving real-world pain points—like legacy account page support, flexible subscription options, and advanced analytics—Ganesh is passionate about building tools that drive growth and retention.