Payments giant Stripe is looking to help companies comply with upcoming PSD2 regulation – as well as get paid more quickly – through the launch of its Stripe Billing service in Europe.
The company said Stripe Billing looks to simplify the recurring billing process for SaaS and subscription-based companies, such as Slack and Meetup in the US.
Instead of manually retrying cards, Stripe Billing’s smart retries use machine learning to figure out the best time to retry failed cards.
In the US, where Stripe Billing launched last year, smart retries have led to a seven per cent lift in recovered revenue, on average, for businesses using Billing, Stripe said.
Stripe says the service provides the easiest path to Strong Consumer Authentication (SCA) compliance for online subscriptions, which will be required when Europe’s second Payment Services Directive (PSD2) comes into effect later this year.
The legislation will require more than 300 million European consumers to confirm their identity using a second factor, such as a password, phone, or fingerprint, in order to complete a purchase.
Stripe Billing product manager Tara Seshan said, “Subscription and SaaS companies have been some of the internet’s greatest success stories up to now, but we’ve barely scratched the surface of what’s possible, especially here in Europe.
“With Stripe Billing, companies of all sizes now have access to advanced invoicing tools that will also help them comply with SCA and VAT requirements.
“We’re excited to power the next generation of European subscription companies as we continue building the economic infrastructure that will grow the GDP of the internet.”
Jordan McKee, research director at 451 Research, said ,”SaaS, subscription and recurring revenue business models have become a major force for economic growth on the internet across Europe. However, for the vast majority of companies, running a billing and subscription system at any scale is both laborious and costly.
“This function will become even more complex once the SCA regulations take effect on September 14, 2019 in Europe.
“Stripe Billing aims to mitigate this complexity and expense for European companies of all sizes by smoothing the path to SCA compliance, and democratizing access to enterprise-grade billing tools.
“Ultimately, tools like Stripe Billing represent an important element of the economic infrastructure that will facilitate the creation of a Digital Single Market across Europe.”
Copyright © 2019 RegTech Analyst
Copyright © 2018 RegTech Analyst
