A recurring payment is an automatic payment made to a business on a set schedule. Also known as subscription payments, these transactions are automatically charged to a customer’s credit card or bank account based on a payment schedule.
Your business needs a lot from you, so it makes sense that you’d welcome any opportunity to put tasks on autopilot. Recurring payments allow you to collect money from your customers with little to no elbow grease required.
We’re digging into everything you need to know about using recurring payments to streamline your business, stabilize your cash flow, and keep your customers happy.
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Recurring payment happens when a business automatically charges a customer on a set schedule. These payments are typically charged to a customer’s credit or debit card or are deducted from their bank account through an ACH transfer.
You probably make a few electronic payments each month yourself. Think about your rent payments, cleaning service, or regular equipment maintenance. Those are all examples of recurring billing that occur automatically on a cycled basis until your payment plan expires, or you cancel the subscription.
Recurring payments can be a major time-saver and keep cash flowing through your business. Having money coming in on a regular, automated basis streamlines the end-to-end billing process. You avoid the hassle of sending repeat invoices, chasing late payments, or securely maintaining card on file records. Recurring payments through QuickBooks also avoid the hassle of manual reconciliation.
Before we dive into the nitty-gritty of how recurring payments work, we’ll cover the two main types of billing categories.
Recurring payments that are fixed (also called regular) are when the same amount of money is collected from the user during each billing cycle. Since the price doesn’t increase or decrease between cycles, this system is the most continuous and stable. With this model, you can stay at ease knowing that you’ll receive your payments on time.
For example, if you’ve signed up for a magazine or newspaper subscription, or even your favorite streaming service, you’re billed through fixed recurring payments.
With variable or irregular recurring payments, the bill is dependent on the usage of the customer. This happens with water and electricity bills as the charge is based on consumption.
This is an irregular payment process because the amount owed may vary (increase or decrease) throughout the month or billing cycle.
There’s no shortage of payment options out there, but the recurring payment option is the only one that takes all of the burden off you and your customers.
With recurring payments set up in QuickBooks Online, the payor independently enters their information in a secure portal. It is a one-time setup process rather than repeated checkout processes, saving your customers time and helping boost your customer retention rate.
Small businesses have an average of $27,000 in unpaid invoices that are over 30 days late. - Intuit QuickBooks Small Business Insights Quarterly
Setting up recurring payments is easy and reduces the chances of late or missed payments. Switching to recurring payments means you're not relying on anyone to remember to pay on time—it's all taken care of.
According to the QuickBooks 2025 Entrepreneurship Report, 73% of business owners say they have plans to build their personal wealth in 2025. One way to do this is by focusing on cash flow and setting up recurring payments with their customers.
You know that cash is king in your business, but the QuickBooks Small Business Insights Quarterly found that 85% of businesses say cash flow is a problem. And almost half (45%) have used their own money to solve their cash flow problems.
That’s where recurring payments come into play. They occur on a regular schedule, ensuring a consistent and stable cash flow. This means less scrambling for funds and more focusing on growing your business.
The very premise of recurring billing is that it’s supposed to be easy, but that doesn’t mean you can roll it out and watch as the magic happens. There are a few best practices you should know to do this right.
Setting up a billing system that works for both you and your clients is key to maintaining a healthy cash flow and ensuring client satisfaction. With QuickBooks Payments, you can customize payment schedules to fit the unique needs of each client. Whether it's deciding on a monthly, biweekly, or weekly billing cycle, flexibility is at your command.
Imagine never having to chase after payments again because your clients receive automated reminders when their payment information needs updating or their card is about to expire. This proactive communication helps prevent payment interruptions, keeping the revenue flowing smoothly and your clients happy.
Beyond just taking payments, it's about building lasting relationships. Frequent and open communication about payment options is one way to show you understand and respect your clients' financial situations. QuickBooks Payments allows you to offer varying payment plans and frequencies, accommodating different budgetary needs which can be a relief for clients worried about cash flow.
Regular updates and easy access to modify their payment details empowers your clients, giving them control over their finances and enhancing their trust in your services. Ultimately, the health of your client relationships dictates the health of your business.
When it comes to billing, transparency is non-negotiable. With QuickBooks Payments, there are no setup costs or hidden fees to worry about. QuickBooks Payments has a straightforward pricing model: pay as you go with ACH payments at 1% and card payments at 2.99%. You choose which options to offer your clients so you can plan your finances without surprises.
By implementing these strategies, not only do you streamline your payment process, but you also strengthen the client-business relationship, fostering loyalty and ensuring ongoing engagement.
Since your client will be sharing their bank or credit card information, look for a provider with a secure payment portal. This will allow your clients to independently enter their own payment information and you won’t need to store and maintain card on file paperwork.
This also plays into ensuring your business policies are transparent. If you fail to make sure this private data is secure and you aren’t transparent, you can risk losing customers and hurting your reputation.
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This content is for information purposes only and should not be considered legal, accounting or tax advice, or a substitute for obtaining such advice specific to your business. Additional information and exceptions may apply. Applicable laws may vary by state or locality. No assurance is given that the information is comprehensive in its coverage or that it is suitable in dealing with a customer’s particular situation. Intuit Inc. does not have any responsibility for updating or revising any information presented herein. Accordingly, the information provided should not be relied upon as a substitute for independent research. Intuit Inc. does not warrant that the material contained herein will continue to be accurate nor that it is completely free of errors when published. Readers should verify statements before relying on them.
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QuickBooks Payments: QuickBooks Payments account subject to eligibility criteria, credit, and application approval. Subscription to QuickBooks Online required. Not available in U.S. territories or outside the U.S.
Automatic Matching: QuickBooks [Online/Money] will only match bank deposits with transactions processed through QuickBooks Payments. Not all transactions are eligible.
Eligible payments are automatically matched with 100% accuracy: QuickBooks Payments transactions made outside of QuickBooks Online are not eligible for automatic matching. Not all financial institutions participate.
Next-day Deposit: : Next-day deposit feature subject to eligibility criteria. Payments processed before 3:00 PM PT typically arrive at your bank the next business day (excluding weekends and holidays). Deposit times may vary for other payment methods, third party delays or risk reviews.
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