Set up recurrent payments via Modulbank's API

Billing type: Anniversary Billing

In this model, customers are billed on the same day each month based on when they initially signed up. For example, if they sign up on the 17th, they’ll be charged on the 17th of every subsequent month.

How It Works:

Initial Payment: Customers are charged on the day they sign up (e.g., 17th of the month).
Subsequent Payments: They continue to be billed on that same day in the following months.

Pros: Fairness: Customers only pay for what they use, and there’s no need for prorating. They get a full month of service for each payment. Customer Satisfaction: Reduces the chance of complaints about unfair billing since users are charged on their specific billing cycle.

Cons: Complexity: Managing multiple billing cycles requires a more complex system. Each customer might have a different billing date, which could lead to a need for more advanced tracking and reporting systems. Cash Flow Management: Revenue can be less predictable since payments are spread throughout the month.

Examples of Platforms Using Anniversary Billing:

AWS (Amazon Web Services): Charges users based on their signup date and usage.
Amazon Prime: Similar to Spotify, Amazon Prime charges users annually or monthly on the same day they initially subscribed.
Slack: Charges customers based on their subscription date, which can vary for each user.
Spotify: When you sign up for Spotify, you’re billed on the same day each month. If you sign up on the 17th of a month, you’re billed on the 17th of every subsequent month.
Salesforce: Salesforce typically uses anniversary billing for its subscriptions, where clients are billed based on their initial signup date.

Why Use Anniversary Billing?

Flexibility for the Business: You don’t need to worry about prorating or managing multiple billing cycles for all users on the same day. Each customer has their own billing cycle, which can spread out your payment processing load throughout the month.
Customer-Centric: Users feel like they are paying for exactly what they are getting—a full month’s service from their sign-up date. It reduces the feeling of being overcharged or underutilizing what they paid for.
Scalable: As your user base grows, managing a rolling billing cycle can help with cash flow, ensuring that you have a more consistent income stream throughout the month rather than having all payments come in on a single day.

Summary of Why Anniversary Billing Might Be Ideal for Your SaaS:

Aligns with Customer Expectations: Users get exactly what they pay for—no surprises, no confusion.
Simplifies Billing: You don’t have to deal with prorating, which can simplify your billing logic and reduce customer complaints.
Proven Model: Many successful SaaS companies use anniversary billing, which suggests it’s a tried-and-true method for managing recurring revenue. Implementing Anniversary Billing in your SaaS can provide a smoother experience for both you and your customers. It helps maintain a fair and transparent relationship with your users, leading to higher customer satisfaction and potentially lower churn rates.

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