Subscription payment models offer businesses a way to generate steady revenue, simplifying financial planning and resource allocation. This article will detail how subscription-based payments function and how tools like MoneyHash can help you customize your subscription offerings for your customers.

## What Is Subscription Revenue?

Subscription revenue comes from customers paying a regular fee to access additional services or products under a specific plan. Essentially, if customers want to unlock new features or services, they subscribe and pay a fee to gain access to these extra benefits. This is known as a recurring payment model, with common examples including services like Spotify, SurveyMonkey, and MailChimp.

## How Does the Subscription Payment Model Work?

The subscription payment model involves customers paying a set amount at regular intervals. This approach provides businesses with deeper insights into their customer base, proving beneficial across various industries such as e-commerce, media, and software.

A [McKinsey Stud](https://www.mckinsey.com/industries/technology-media-and-telecommunications/our-insights/thinking-inside-the-subscription-box-new-research-on-ecommerce-consumers#0) highlights the significant growth of this model in e-commerce: over the past five years, the subscription market has expanded by more than 100% annually. The largest subscription retailers soared from $57.0 million in sales in 2011 to over $2.6 billion in 2016, illustrating the model's effectiveness and popularity.

## How Can a Subscription Payment Model Impact Your Business?

The subscription payment model can profoundly influence your business in several ways, all of which contribute to sustainable growth and customer satisfaction.

1. **Better Customer Experience**

 Implementing subscriptions can significantly improve customer experience. By tracking customer behavior changes over time, businesses can enhance overall customer satisfaction. Tailored experiences foster higher customer retention and open more opportunities for upselling and cross-selling.

2. **Longer Purchasing Lifespan**

 The subscription model tends to extend the purchasing lifespan of customers. It encourages ongoing customer engagement, thereby strengthening brand loyalty and ensuring steady revenue. Automatic subscription renewals further prolong customer interaction with your brand.

3. **Lower Churn Rates**

 Adopting a subscription model can lead to reduced churn rates, as it incentivizes businesses to focus on customer satisfaction and retention. Satisfying customers involves offering high-quality service, easy payment options, and attractive offers, all of which contribute to a premium and balanced customer experience.

## How Customers Shift To Subscription Payment?

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Customers are increasingly choosing [subscription payments for three main reasons](https://www.forbes.com/sites/louiscolumbus/2018/03/04/the-state-of-the-subscription-economy-2018/?sh=2698a8e853ef):

- **Access**

- **Curation**

- **Renewal/Replenishment**

![Reasons customers subscribe to a subscription based product ](https://s3.ca-central-1.amazonaws.com/launchman/btetnf_Generate-Revenues-with-Subscription-Payment-Models.jpg)According to McKinsey Analysis, **13%** of customers subscribe for **access** to more features, **55%** of the customers subscribe for **curation** of service, while **35%** choose subscriptions for the convenience of **renewal or replenishment**, which essentially means saving time and consistently meets their needs.

### **Three Approaches To Urge Customers To Subscribe**

There are three approaches to urge customers to subscribe to your payment plans. 

- **Specific Offers:** One approach to urge your customers to shift to subscription payments is collecting membership fees in return for special offers. Examples of this strategy can be **Walmart, Emirates Airlines, Noon, Talabat Plus**, and more.

- **Time-Limited Access:** Another approach is providing time-limited access to services like software-as-a-service (SaaS) companies, media, and entertainment platforms. Examples of this approach are **GoDaddy, Zoom, Slack**, and more.

- **The Subscription Box**: the last approach is a ’**subscription box**’ service. The subscription box service is another way to curate services and deliver products to customers repeatedly, such as ready meal services. For instance, **Blue Apron and Factor** are vivid examples of this approach.

## Your Technical Partner After Receiving Subscriptions

Choosing a dependable technical partner is key once you start receiving subscription payments, as they'll help you manage the technicalities of the subscription model effectively.

Look for a subscription partner who can provide:

- Customizable subscription plans tailored to various needs
- Configurable pricing tiers
- Efficient management of billing cycles
- A range of payment methods to suit different customer preferences
- Automated recurring billing for hassle-free transactions
- Secure payment processing to ensure data safety

## MoneyHash Subscription Module Covers All Your Needs

The [MoneyHash subscription module](https://moneyhash.io/pricing) is your all-in-one solution for managing subscription payments. It allows you to create unlimited customized subscription plans, including varied pricing, billing frequencies, end dates, and free trial periods.

You can select from **pre-designed plans** when launching new subscriptions. Then, you can apply any **discount for more compelling offers** for your customers. Easily enough, each plan can be tailored to meet individual customer needs.

MoneyHash also supports a **variety of payment methods**, catering to diverse customer preferences.

Additionally, MoneyHash can **tokenize** your customers' cards for automated billing. You'll be able to keep track of your customers' subscription statuses and make necessary adjustments as required.

## Conclusion

The subscription payment model is a great strategy for maintaining customer loyalty, increasing revenue, and extending customer engagement. However, managing it can be complex. Partnering with MoneyHash simplifies subscription management, ensuring a smooth and secure experience for both you and your customers. [Get started with MoneyHash](https://moneyhash.io/get-started) today for a tailored subscription management experience and let our team assist you with any queries.

Explore the benefits of subscription payment models for steady revenue and enhanced customer loyalty in our guide. Learn how subscription models work, customer motivations for choosing them, and how MoneyHash provides an all-in-one solution for effective subscription management.

What Is a Subscription Revenue Model and How Does it Work? 

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The payment landscape in the Middle East and North Africa (MENA) region is a highly fragmented market that is ready for comprehensive solutions. Despite the challenges posed by these fragmented systems, there's a noticeable and rapid growth in digital payments.

These systems are not only expanding but also introducing new digital payment methods that are quickly becoming popular among consumers. One might wonder, how is this significant growth happening amidst the fragmentation in the MENA payment ecosystem?

In this article, we'll delve into this question and examine the most popular payment gateways in MENA countries.

### **Digital Payment State Between Fragmentation & Flourish**

The digital payment systems are swinging between two stages; fragmentation and flourishing. 

**Fragmentation**: According to the [International Monetary Fund (IMF](https://www.imf.org/en/News/Articles/2022/05/10/sp051022-md-concluding-remarks-at-the-snb-high-level-conference)), the payment systems in the Middle East and North Africa (MENA) are very disjointed. Each country in the region has its own set of payment rules.

This means that the payment systems are not stable and lack a uniform approach across all countries.

**Flourish**: Despite the disjointed nature of the payment systems in the Middle East and North Africa (MENA), digital payments are rapidly growing in the region. Current payment gateways are expanding, and new payment aggregators are entering the fintech market. This leads to a fragmented yet quickly evolving fintech ecosystem.

According to[ Mastercard's latest payments index](https://www.mastercard.com/news/eemea/en/newsroom/press-releases/press-releases/en/2022/august/mastercard-new-payments-index-2022-consumers-in-mena-embrace-digital-payments/), **85% of people in MENA** have used at least one new payment method in the last year. \
Here are some of the new payment methods that are emerging:

- Mobile wallets that you can tap to pay (For example, PayPal)

- Buy Now, Pay Later services (BNPLs) (Example: VALU)

- Direct transfers from one bank account to another (Example: Instapay)

- Wearable devices with NFC technology for payments (Example: Thales Gemalto PayBand)

For example, digital payment transactions in the UAE have **grown by 9% every year from 2014 to 2019**. In comparison, Europe's average annual growth in the same period was only 4 to 5%.

In Saudi Arabia, digital transactions at points of sale **doubled in 2021.** The Saudi government, as part of its Vision 2030 plan, aims to have 70% of its total transactions be digital by 2030.

## **Fintech Products In MENA**

Fintech products in MENA found a way to grow exponentially. Thanks to the nature of highly populated countries, it easily became a sweet spot for fintech products. 

### **Enabling Unbanked Consumers to Pay Online**

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A major issue in the Middle East and North Africa (MENA) region is the high number of people without bank accounts. The big question has been how to include these unbanked individuals in the financial technology (fintech) world. Fortunately, emerging payment solutions, such as e-wallets, have made it possible for these unbanked people to make online payments.

E-wallets have shown great potential, especially in countries like Egypt, where a third of the population doesn't use banks. As a result, local payment providers are becoming key partners for online businesses in the region.

## **What Are The Preferred Payment Gateways In MENA?**

![Choosing between various payment methods in the Middle East and Africa](https://s3.ca-central-1.amazonaws.com/launchman/i8ssw4_p11.webp)Before answering the question of what are the preferred payment gateways in MENA, let’s first state the fact that every customer has their payment preferences. Thus, It’s crucial for payment businesses operating in MENA, to choose a relatable payment gateway that matches the payment preferences of their target customers. 

As a result, this link will narrow the gap between the targeted customers and the service providers, increasing conversion rates, and enhancing the customer experience.

### **A Rundown Of Most Used Payment Gateways in MENA By Country**

Let’s have a holistic view of the most used payment gateways in each country. Here's a rundown of seven countries as follows:

### Egypt

Let’s start with Egypt as an active hub for fintech startups. **Cash** is still the most used payment method, accounting for [57% of total transactions](https://www.statista.com/statistics/980465/egypt-share-of-payments-ecommerce-purchases-by-method/#:~:text=Cash%20was%20the%20main%20dominant,percent%20were%20paid%20through%20wallets.%20.) even though card payments have increased to **22%.** 

The most used payment gateways for card payments and e-wallets are: 

- Fawry Pay

- Payfort or APS

- Paymob

- InstaPay

### UAE

The most used payment method in the UAE is **digital wallets**, followed by cards. According to a [recent survey](https://gulfbusiness.com/did-you-know-that-over-half-of-the-uae-population-use-digital-wallets/), “16 percent of 18-24 year-olds prefer digital wallets, compared to 9 percent of 25-34 year-olds.” In other words, **50% of the population** **prefers e-wallets**. 

Thus, the most popular payment gateways based on transaction fees and customer service are:

- Telr

- Payfort

- [Checkout.com](http://Checkout.com)

- Paytabs

### Saudi Arabia

Unlike others, **cards** are the most common payment method in Saudi Arabia. There is a huge increase accounting for 41% of transactions in the country. Cards are followed by cash on delivery and e-wallets for online transactions. 

The most used payment gateways in Saudi Arabia are:

- Tap

- Hyperpay

- Payfort

- Paytabs

### Qatar

In Qatar, **cash** remains a predominant payment method, according to Qatar's central bank. In 2021, the total value of cash transactions amounted to **71.5 billion versus 70.8 billion card transactions**. 

Yet, it’s fair to say that Mobile payments especially e-wallet usage have increased during **2021 compared to 2020**. 

The most used payment methods in Qatar are:

- Qpay

- Sadad

### Kuwait

**Cards** are the first payment method used in Kuwait for online purchases or in-store transactions. The amount of card transactions has reached up to [**61% versus 11%**](https://www.zawya.com/en/world/middle-east/kuwait-makes-39294mln-online-purchases-withdrawals-payments-in-first-6-months-of-22-jjm75aq9) for cash transactions. 

The adoption rate of digital methods of payments is quite significant in Kuwait.

### South Africa

In South Africa, **cards** (which reached nearly **40%** of transactions) are the first payment method, followed by cash and bank transfers. 

The most prominent gateways in South Africa are:

- Payfast

- Yoco

- Zapper

### Nigeria

Cash and debit cards are the two most common payment methods in Nigeria. Nigerian people rely heavily on cash although there are various payment methods in the country. 

The common payment gateways used by online businesses in Nigeria are:

- Paystack

- Flutterwave

- VoguePay

## Conclusion: Partner with a Payment Provider for Unbiased Advice

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To sum up, digital payment adoption rates vary widely across the MENA region, with each country featuring its own unique set of local payment methods and challenges.

Imagine how hectic it can be to understand each market and customize payment options for different customer groups yourself! It's a daunting task!

Instead of trying to build your own payment system from scratch, it's more efficient to [leverage a payment partner like MoneyHash ](https://moneyhash.io/get-started)who can consolidate all these diverse needs into a single, centralized platform.

This approach not only simplifies your payment process but also frees up your time, allowing you to focus more on your core business activities.

---

## FAQ:

**What are the emerging payment methods in the MENA region?**

- Tappable mobile wallets (Example: PayPal)

- BNPLs (Examples: VALU)

- Account-to-account (Example: Instapay)

- Payment-enabled wearable NFC tech devices (Example: Thales Gemalto PayBand)

- 

**What Are the Common Payment Gateways in Egypt?**\
The most used payment gateways for card payments and e-wallets are: 

- Fawry Pay

- Payfort or APS

- Paymob

- InstaPay

The state of payment systems in the MENA region reflects a highly fragmented market that needs unbiased partners like MoneyHash. The good news is that despite hyper-fragmented payment systems, the spike in digital payments is growing exponentially.

The State of Payments in the MEA: A Fragmented Market In Need of Unbiased Partners

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For online business owners, selecting the perfect payment provider is crucial for ensuring a smooth checkout experience for customers. The right choice not only enhances customer satisfaction but also boosts conversion rates.

But how do you navigate the complex world of payment providers to discover the one that best suits your business? In this comprehensive guide, we will outline the essential steps to make an informed decision and discuss the primary factors to consider when choosing a payment aggregator.

## **Steps to Choose the Right Payment Provider**

Every business must consider several important steps before selecting a payment provider. Let's go through these essential steps:

### **Step 1: Define Your Payment Strategy**

Before you choose a payment partner, you need to define your payment strategy. This involves understanding the payments scheme in your region, and determining which payment methods your target customers prefer. You can hire a payments expert or study the market yourself, but it can be time-consuming. Alternatively, you can use a [provider-agnostic orchestration platform](https://moneyhash.io/blog/product-introducing-moneyhash-2-0) like [Moneyhash](https://moneyhash.io/) to get expert insights and help you achieve your company goals.

### **Step 2: Consider Your Targeted Market & Expansion Plans**

When selecting a payment partner, it's essential to consider your operational and expansion goals. This includes understanding where you plan to do business based on your overall strategy and the specific markets you're targeting. Once you identify the countries where you'll operate, ensure that your payment provider aligns with the needs and preferences of your target market in those regions. Conducting market research can be invaluable in this phase.

If you're a startup in the early stages of growth, a thorough study of targeted markets and potential expansion areas is crucial. This step should be tailored to your business plan and chosen market. For instance, if your company aims at cross-border operations, offering a variety of payment options is vital.

Ultimately, your chosen payment provider should facilitate an efficient checkout process adaptable to each region you operate in.

### **Step 3: Consider The Transaction Fees Factor**

Considering transaction and markup fees is vital for your payment and pricing strategy. The transaction fees you set will depend on your business size and your payment provider's commission. These fees usually include a percentage, typically between 1% to 5%, plus a fixed fee. Larger businesses with higher transaction volumes often get better rates. If your business is small or considered high-risk, payment providers may charge higher fees.

Markup fees typically cover costs from the card network, the card-issuing bank, and the payment processor, and they might also include account management fees. Usually, local payment providers offer better rates than global providers, as there are fewer parties involved in the transaction process.

## **Should You Choose a Local Or Global Payment Provider?**

![Choosing between a Local Or Global Payment Provider](https://s3.ca-central-1.amazonaws.com/launchman/ocaail_p15.jpeg)Choosing between a local provider or a global payment provider depends on several elements:

### **1. Markup Fees**

If you want to get the lowest rate of markup fees, then working with local providers in each country is considered a better option. Yet, if you are willing to pay higher fees, then working with a global payment partner may be more convenient as you will only need to integrate with one provider.

### **2. Technical Expertise and Resources**

If you are working with multiple providers across different countries, this can be a significant undertaking. You need to have the technical expertise and resources to handle the integration and maintenance of the different systems. If you don't have the resources or technical expertise, it may be best to work with a global payment partner that can handle integration and maintenance for you.

### **3. Ensure PCI Compliance**

You need to make sure that your customer's sensitive data is protected at all times because that involves your business's reputation. All businesses that store, process or transmit payment cardholder data must be PCI compliant. Your payment partner has to be PCI certified, so you can consider working with them.

### 4\. Reputation and Support

Before choosing a payment partner, research their reputation in the market and ask their clients who operate in the same industry as you about their service. Be sure to also check if there are any microservices or additional support you want from that partner that would enhance the checkout experience for your customers.

## **Set an Implementation Plan**

Once you have chosen your payment provider, it is time to put a plan in place for execution. If time to market is a big deal to you, you may consider a payments orchestration like Moneyhash to advise you and help you move forward faster. With Moneyhash, you can implement a complete payments infrastructure from strategy to execution in less than two weeks.

## **The Bottom Line**

Choosing the right payment partner for your online business is crucial to optimizing your checkout process and boosting conversion rates. It's important to take the time to understand your options and determine what will best serve the needs of your business and your customers. Consider factors like target market, fees, PCI compliance, reputation, and support when choosing your payment partner. If you need expert insights and a faster time to market, consider using a payments orchestration platform like Moneyhash. With Moneyhash, you can focus on growing your business while leaving the payment processing to the experts.

---

### **FAQs:**

1. **What Are the Steps to Choose the Right Payment Provider?**

 - Step 1: Define Your Payment Strategy

 - Step 2: Study the Targeted Markets and Expansion Plans

 - Step 3: Consider The Transaction Fees Factor

2. **What to Choose a Local Payment Provider Or a Global Payment Provider?**

 - The Markup Fees

 - Technical Expertise and Resources

 - Ensure PCI Compliance

 - Set an Implementation Plan

 In this complete guide, we'll walk you through the key factors to consider when choosing a payment provider and provide tips for making the right choice.

How To Choose The Right Payment Provider For Your Business

Mohga Koshty 

Doaa Amer

Rana Hammad 

Nader Abdelrazik 

Marek Michalski

MoneyHash Team 

- It uses second person language
- It uses simple analogies to better explain complex ideas, no technical language
- It uses a skimmable format with bullet points, subheadings
- Overall it’s a payment industry expert that is a approachable, has some nerdiness, has fresh new takes to old concepts.
- The readers should be guided with the patience of a teacher that is able to simplify super complex topics into easy to understand and digestible pieces
- It does not sound like large corporates, overly formal, boring, and not overly friendly, immature

MoneyHash is an all-in-one flexible payments and revenue operations platform that covers all of your payment needs. It is the first of its kind in Africa and the Middle East. With Connections, you can build, optimize, and scale your payment infrastructure at any stage of growth. It is designed to simplify your payment processes and meet all your needs in minutes, not months.

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