Which payment infrastructure is preferred for online subscription services?

Recurring card payments are favored for online subscription services because they provide a seamless and automated payment experience for customers. This infrastructure allows users to set up a payment method once, enabling automatic billing on a regular schedule—typically monthly or annually—without requiring the customer to take further actions each billing cycle. This convenience increases customer retention and reduces the likelihood of missed payments, since the service continues uninterrupted as long as the subscription remains active.

Additionally, with recurring payments, businesses can more accurately forecast revenue and cash flow, as they can expect a steady stream of income based on the number of active subscriptions. This differs significantly from the other options, which either require customers to actively manage payments or do not provide a sustainable revenue model for subscription-based services. Cash transactions, for example, lack the automation needed for ongoing payments, and single payments or monthly invoicing do not capture the long-term engagement that recurring payments promote.