The global Subscription and Recurring Payment Market is estimated to be valued at US$ 154.05 Bn or Billion in 2022 and is expected to exhibit a CAGR of 18.5% over the forecast period 2023-2030, as highlighted in a new report published by Coherent Market Insights.
Market Overview:
The subscription and recurring payment market includes models where customers can purchase goods and services on a recurring basis over specific periods of time, usually monthly or annually. Some key advantages of subscription models include predictable cash flow for businesses, guaranteed recurring revenue streams, and convenience for customers who receive automatic deliveries or access. The need for subscription models has increased considerably across various sectors like OTT platforms, online content, software-as-a-service (SaaS), and others due to the convenience they offer to both businesses and customers.
Market key trends:
One of the major trends driving growth in the subscription and recurring payment market is the rising adoption of software-as-a-service (SaaS) models across various industries. SaaS enables customers to access and use software applications over the internet on a subscription basis rather than purchasing them outright. As companies continue digitizing their operations, the demand for cloud-based software and platforms is surging significantly. Other key trends include the growing popularity of subscription e-commerce models, subscriptions for online content and streaming, increasing penetration of digital payments globally, and upgrades in payment technologies facilitating hassle-free recurring payments.
Porter’s Analysis
Threat of new entrants: The threat of new entrants is moderate in the subscription and recurring payment market due to the requirement of huge initial investments and the presence of established players.
Bargaining power of buyers: The bargaining power of buyers is high as buyers have a variety of payment options to choose from and can switch between payment providers easily.
Bargaining power of suppliers: The bargaining power of suppliers is moderate as suppliers rely on payment providers for a consistent revenue stream.
Threat of new substitutes: The threat of substitutes is high as new payment methods like digital wallets and cryptocurrencies are emerging as alternatives.
Competitive rivalry: competition is intense among the established players.
Key Takeaways
The global subscription and recurring payment market is expected to witness high growth, exhibiting a CAGR of 18.5% over the forecast period 2023-2030, due to increasing adoption of subscription-based business models. The market size for 2022 was US$ 154.05 Billion.
The North America region is expected to dominate the market during the forecast period. Rapid adoption of advanced technologies, presence of key players, and high penetration of online shopping are some of the factors driving the market in the region.
Key players operating in the subscription and recurring payment market are PayPal, Stripe, Square, Recurly, Chargify, Zuora, FattMerchant, Payment Depot, PaymentEvolution, FastSpring, Chargebee, Spreedly, ChargeOver, Chargent, Vindicia, Cashfree, CCAvenue, BillDesk, and Razorpay. Key players are focusing on partnerships and mergers to expand their geographic presence. For instance, in 2022, PayPal acquired Channelspend to boost its B2B capabilities.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
