A smart path every SaaS business can take is to leverage SaaS payment solutions. However, 47% say that most failed payments result from payment processing troubles.
What does this mean? Simple—don’t just blindly choose your SaaS payment processing tool. Beyond handling transactions, a good one can streamline the entire subscription experience for both customers and business owners.
However, there are many tools to choose from, and it’s normal to feel stuck or overwhelmed. In this blog, we’ll explore the key capabilities to look for in a SaaS payment processor and suggest the top 7 SaaS payment solutions you can start looking into.
What are SaaS payment processing tools?
A SaaS payment processing tool handles the financial transactions between a subscription business and their customers. It collects payments, manages recurring billing, and offers global payment methods for you—but minus the hassles of financial compliance, gateway management, or security.
Suppose a customer subscribes to you. The payment processor then handles the succeeding steps:
- The processor verifies if the payment method is valid and the customer has sufficient funds.
- It automates the collection of payments at predefined intervals.
- The SaaS payment processing software ensures the protection of sensitive customer data through encryption and compliance with industry standards
These are only a fraction of what a SaaS payment processor entirely does. In a nutshell, it’s a key player in streamlining your billing operations, enhancing customer experiences, and simplifying invoicing and payment collection by supporting multiple payment methods. Take note though—they’re different from billing platforms for SaaS that often have broader functionalities, including invoicing, revenue recognition, and financial reporting.
Key features to look for in a SaaS payment processor
A SaaS payment processor may be your best investment yet, but you will need to evaluate their payment processes through a strategic lens. We list below the key features you should prioritize.
Recurring billing automation
Without automation, your team spends hours every month chasing recurring payments. So, if you get billing as a service make sure it can automate recurring billing. This will guarantee that your subscribers are charged on time—and every time.
Subscription management
It’s not uncommon for a subscriber to upgrade or downgrade subscription plans. But when there’s friction doing that (changing plans or resolving billing issues), they’re prone to churn instead. Worse, if your team manually adjusts billing cycles, this causes delays in customer service.
Payment gateway integrations
If your SaaS platform operates in diverse markets, using more than one gateway can help optimize for regional preferences. So instead of relying on a single payment gateway, opt for a SaaS payment processor that integrates with multiple payment providers—such as Stripe and PayPal—thus providing backup options and increasing payment success rates. It also lets you localize payment methods.
Fraud prevention and security
A payment processor with built-in fraud prevention tools protects your revenue and minimizes chargebacks ensuring that only valid transactions go through. After all, every chargeback is both a lost revenue and an operational cost.
Automated payment retries
Go for a SaaS payment processor with built-in or customizable dunning workflows that send timely email nudges, retry payments at optimized intervals, and even flag accounts for manual intervention. The goal? Reduce involuntary churn by ensuring small, preventable issues like expired cards don’t become lost subscriptions.
Pro tip: Launch dunning email campaigns in parallel with our Recover Payments solution. Our human experts powered by technology will strategize and execute payment recovery campaigns so you recover at least 50% of your monthly lost revenue.
Global compliance
Staying compliant with global regulations is a must, especially when you need to accept payments globally while expanding internationally. Only choose a SaaS payment solution that’s PCI-DSS compliant and with compliance management. That way, you can process payments securely and give your customers peace of mind.
Top 7 SaaS payment processors in 2024
Remember, the right payment processor is about finding the right fit for your business’s growth, scalability, and operational needs. Here are some suggested payment processing solutions you can begin to explore:
- Stripe
- PayPal
- Chargebee
- Wise (formerly TransferWise)
- Payoneer
- FastSpring
- Stax Connect
1. Stripe
Stripe is a payment processor known among SaaS businesses and developers. Its developer-centric approach—a powerful suite of APIs—gives its users full control over customizing the payment experience. Stripe supports over 135 currencies and ensures PCI compliance with built-in encryption for security.
Pros:
- Highly customizable with advanced APIs
- Extensive integration capabilities with various e-commerce platforms.
- Multiple payment options
Cons:
- Requires technical expertise for advanced features.
Pricing: Stripe charges 2.9% + $0.30 per successful charge for domestic cards.
2. PayPal
One of the most recognized names in online payments, PayPal has a unique emphasis on buyer and seller protection. Despite its robust features to resolve disputes efficiently, it’s easy to set up and use. Furthermore, you can quickly integrate PayPal with your websites to simplify payments and customers benefit from its one-click checkouts.
Pros:
- Accepted by millions of businesses worldwide.
- Global payment acceptance with multiple currencies.
- Easy to integrate, requiring minimal coding effort.
Cons:
- Higher transaction fees compared to some competitors.
Pricing: Varies based on market/region. Check PayPal’s website for detailed pricing information.
3. Chargebee
Chargebee specializes in subscription management and recurring billing, making it an excellent choice for SaaS companies and businesses reliant on subscription models. This SaaS billing software is noteworthy for its scalability. As your company adds new tiers, countries, or product offerings, Chargebee automates the chaos—no need for manual updates or complex configurations.
Pros:
- Excellent for complex subscription models.
- Strong dunning management to reduce churn.
- Smooth integrations with CRMs and accounting tools.
Cons:
- No built-in merchant account
Pricing: An overage fee of 0.75% applies if monthly billing exceeds $100K.
4. Wise (formerly TransferWise)
Wise is built for businesses, including SaaS, managing international payments. The SaaS payment solution offers real mid-market exchange rates—meaning no hidden fees—making it one of the most cost-effective ways to transfer and hold money globally. You can hold balances in 40+ currencies and receive local bank details in several major countries.
Pros:
- Transparent fee structure with no hidden costs.
- Real exchange rates without markups.
- Ability to hold multiple currencies in one account.
Cons:
- Primarily focused on money transfers, with limited payment processing options.
Pricing: Fee starts from 0.35% per transfer but varies by currency.
5. Payoneer
Payoneer is a SaaS payment processing platform focusing on cross-border transactions. It allows SaaS companies to get paid like locals in various countries, supporting global bank transfers and marketplaces like Amazon and Upwork. With Payoneer, you can manage both vendor payouts and employee payments seamlessly.
Pros:
- Supports international bank transfers in local currencies.
- No fees for Payoneer-to-Payoneer transactions.
- Easy integration with marketplaces like Amazon.
Cons:
- Monthly maintenance fees may apply depending on account activity.
Pricing: For credit card transactions, Payoneer charges up to 3.99%.
6. FastSpring
Although FastSpring does offer payment processing services, it is often categorized more as a Merchant of Record (MoR) service. As a payment processor, it supports a subscription-based billing model be it on monthly, yearly, or metered usage plans.
Pros:
- Acts as a Merchant of Record, reducing compliance risks.
- Automated tax, VAT, and local regulatory management.
- Excellent for businesses expanding internationally.
Cons:
- Transaction fees can add up for high-volume merchants.
Pricing: FastSpring offers flat-rate pricing but talk to sales for the exact cost.
7. Stax Connect
If you want to embed payments directly into your software, Stax Connect is your SaaS payment solution. It’s a white-label payment service meaning you can offer payment processing under your own brand with complete control over the user experience. Still, it has a full suite of subscription management capabilities including recurring billing and digital invoicing.
Pros:
- White-label solution lets you brand the payment experience.
- Supports recurring billing and subscription management.
- Real-time analytics and easy payouts.
Cons:
- Best suited for platforms processing large volumes.
Pricing: Paid plan starts at $99/month but SaaS-specific plans require custom pricing.
How to choose which SaaS payment processor to go with
Now that you know the key features to look for in a billing system and even some suggested SaaS payment processing solutions, here are a few questions to ask yourself.
Does it fit your existing tech stack?
Before settling on a SaaS payment processor, assess how well it integrates with your existing tools. Whether you’re using CRM platforms like Salesforce, accounting software like QuickBooks, or marketing automation tools like HubSpot, seamless integration can save you tons of manual work.
Will this solution grow with you?
Let’s talk about a payment processor’s scalability. The tool you choose today must also handle your business tomorrow. Start by asking:
- Will it support higher transaction volumes as you scale?
- Can it manage the complexity of adding multiple product tiers, currencies, or payment methods without constant reconfiguration?
- Does it offer tools to support customer retention at scale?
What are my non-negotiables?
Sure you have unique requirements that are non-negotiable, and these should dictate your choice. Prioritize them over flashy features. A SaaS payment platform that checks every other box but falls short on a non-negotiable won’t serve you in the long run. Some critical non-negotiables are built-in fraud prevention and multi-currency processing support.
Is it within my budget?
Payment processors typically charge a percentage-based fee for each transaction, but that’s not the whole story. Evaluate not only the upfront pricing but also the total cost of ownership over the next years. Along with the transaction fee, watch out for:
- Overage fees when you exceed transaction limits.
- International processing fees for cross-border transactions.
- Costs associated with upgrades, integrations, or technical support over time.
How much flexibility do you need?
Some SaaS businesses need deep customization while others can thrive with a plug-and-play setup. Assess whether your business needs:
- Branded payment experiences integrated directly into your platform.
- Custom billing logic (like proration or usage-based billing).
- Developer support and APIs to build bespoke workflows.
Leverage the power of SaaS payment processors
Your SaaS payment solution, including the right SaaS payment gateway, will impact your revenue and customer retention. So, make sure it streamlines your operations and also contributes to customer satisfaction.
However, payment failures are still possible. This is where leveraging the expertise of Recover Payments specialists can be a game-changer. Our team can help you recover failed payments effectively—ensuring that you don’t lose valuable customers and revenue. Book a call now so you don’t leave your success to chance.
