As the role of these services in the lives of consumers and the digital economy continues to grow, financial institutions need to ensure they are doing their part in enabling seamless experiences.
In today’s digital age, where convenience is paramount and subscription services are on the rise – expected to reach $406 billion globally by next year – managing recurring payments has become more challenging – and critical – than ever.
From streaming platforms to monthly meal kit deliveries, subscription services offer unparalleled convenience and customization, reshaping how consumers purchase products and services.
An eCommerce company offers a ‘Prime’ example, with more than 200 million worldwide members holding a subscription to same- or next-day deliveries – an offering expanded over the years to include access to exclusive deals, a streaming video on demand (SVoD) service, and more. The company’s Subscribe & Save allows users to automate deliveries of household essentials, not only making routine purchases hassle-free but also offering discounts. These services have become integral to the daily lives of their users, shaping spending habits and expectations.
As the popularity of SVoD services continues to rise in CEMEA, the growth potential is substantial – as is the corresponding significance of the wider subscription economy. Across the Middle East and North Africa, Sub-Saharan Africa, and Eastern Europe, SVoD subscriptions are expected to have doubled by 2029.
This growing subscription trend extends far beyond large corporations to SMBs, with a multitude of subscription services catering to diverse needs. From bespoke beauty collections delivered across GCC by a beauty subscription box to a South African eCommerce platform that sends subscribers premium stationary boxes every month, subscriptions offer convenience, customization, and cost savings. Even traditional industries like pet supplies and prescription drugs have embraced subscription models, providing recurring deliveries tailored to individual preferences.
The subscription economy’s growth has been fueled by various factors, including the rise of eCommerce, consumer demand for personalized experiences, and advancements in technology. Today’s consumers enjoy access to a vast array of products and services without leaving their homes, scheduling deliveries and accessing services to fit their lifestyles seamlessly.
This surge in subscription-based services presents both opportunities and challenges for consumers and businesses alike. While consumers do enjoy the benefits of convenience and cost savings, managing multiple subscriptions can be overwhelming, and consumers need a solution that provides transparency and control over their recurring payments.
Recognizing the key role that subscriptions have to play in consumers’ lives and within the wider digital economy, Visa has launched Subscription Manager, a tool for financial institutions to provide Visa cardholders with a simpler and streamlined way to track and manage their subscriptions directly from their banking apps.
With Subscription Manager, cardholders have convenient oversight as to where their card details are stored, helping them identify recurring payments associated with their cards, and cancel unwanted subscriptions with a few convenient clicks – across everything from streaming platforms and gym memberships to news apps.
As the demand for subscription-based services continues to rise, so too does the need for streamlined management of payments. Subscription Manager not only meets consumers’ evolving needs but also benefits issuers and acquirers. By reducing chargebacks, disputes, and call center volumes, Subscription Manager lowers costs and enhances operational efficiency for issuers. For acquirers, it reduces payment authorization declines and standardizes the handling of stop payment instructions.
With the subscription economy continuing to reshape consumer spending habits, banks must provide solutions that ease the management of recurring payments. By embracing these tools, financial institutions can continue to provide value-added services that meet consumers’ evolving needs – and retain their loyalty.
