Market Overview:
The subscription and recurring payment market refers to platforms and services that help businesses charge their customers on a recurring basis through digital payments. These solutions allow merchants to regularly bill customers for subscriptions, memberships, and recurring services. They make it easy for businesses to manage billing and recurring payments through online payment methods like credit cards.
The global subscription and recurring payment Market is estimated to be valued at US$ 154.05 Bn or Billion in 2023 and is expected to exhibit a CAGR of 18.% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
One of the major trends driving the growth of the subscription and recurring payment market is the rapid adoption of subscription-based business models across various industries. Traditionally subscription-based businesses, like streaming media and software-as-a-service, have experienced exponential growth in recent years. At the same time, many physical goods and services are also transitioning to subscription models. This includes industries like cosmetics, gym memberships, razor blades, and more. As recurring or subscription-based revenues become more commonplace, the need for robust billing and recurring payment solutions is increasing accordingly. Other factors like the growing preference for contactless digital payments amid the pandemic and advancements in payment technologies are also fueling the demand.
SWOT Analysis
Strength: The subscription and recurring payment model provides predictable cash flows for businesses and consistent access to services for customers. It allows businesses to upsell and cross-sell additional services to existing subscribers.
Weakness: Customers may feel locked into long-term contracts and subscriptions. Setting up recurring billing requires technical integration that many small businesses lack.
Opportunity: The growth of software-as-a-service and streaming services is driving more businesses to adopt subscription models. Emerging markets still have headroom for subscription adoption.
Threats: Economic downturns could force customers to cancel discretionary subscriptions. New entrants may offer more flexible terms or disrupt existing subscription models.
Key Takeaways
The global subscription and recurring payment market is expected to witness high growth, exhibiting CAGR of 18.% over the forecast period, due to increasing adoption of subscription-based business models across industries like media & entertainment, healthcare, and e-commerce.
Regional analysis: North America dominates the current market due to high penetration of subscription services in media, software, e-books, among others. Asia Pacific is expected to be the fastest growing market owing to large population, increasing disposable incomes, and expanding middle class in countries like China and India.
Key players operating in the subscription and recurring payment market include PayPal, Stripe, Square, Recurly, Chargify, Zuora, FattMerchant, Payment Depot, PaymentEvolution, FastSpring, Chargebee, Spreedly, ChargeOver, Chargent, Vindicia, Chargify, Razorpay, Cashfree, CCAvenue, BillDesk. These players are focusing on partnerships, product innovations and geographical expansion to strengthen their market presence.
