Contents
- What is SaaS billing software?
- Best SaaS billing software compared (fees as of October 2026)
- 1. Stripe Billing: best for most startups
- 2. Paddle: best merchant of record
- 3. Recurly: best for subscription-focused teams
- 4. Chargebee and Lago
- How much does SaaS billing cost? A worked example
- How do you choose SaaS billing software?
- Which SaaS billing platform fits your stage?
- What features should SaaS billing software have?
- How do you choose by company stage?
- Migration checklist
- Common mistakes
- Frequently asked questions
- SaaS billing software: pros, cons and who each platform suits
What is SaaS billing software?
SaaS billing software manages recurring subscriptions: pricing plans, trials, upgrades, invoices, proration, failed-payment retries (dunning) and revenue reporting. Some tools sit on top of your payment processor, while others act as the seller of record and take over payments and tax.
Best SaaS billing software compared (fees as of October 2026)
| Platform | Best for | Published pricing |
|---|---|---|
| Stripe Billing | Startups already on Stripe | Pay as you go: 0.7% of Billing volume. Monthly plans: $620 (up to $100K volume), $1,500 (up to $250K), $2,950 (up to $500K), $5,750 (up to $1M). Card payments 2.9% + 30¢; ACH 0.8% capped at $5 |
| Recurly | Subscription businesses | Starter $249/mo + 0.9% of billing volume (first $40K each month free of the fee); All-Access from under 1% with a $1M volume minimum |
| Paddle | Global tax and compliance | 5% + 50¢ per Checkout transaction, all-inclusive (payments, tax, fraud, chargebacks); products under $10 need bespoke pricing |
| Chargebee | Scaling B2B SaaS | Free starter option and custom Enterprise; details varied on the page we checked, so confirm with the vendor |
| Lago | Usage-based and open source | Open source available; Lago Premium (cloud or self-hosted) by quote |
1. Stripe Billing: best for most startups
Stripe Billing charges 0.7% of Billing volume with no recurring fee on pay as you go, or fixed monthly tiers if you commit to a one-year contract. Each tier adds 0.67% for volume beyond its cap. The customer portal is included, with a custom domain at $10 per month. Payment processing is billed separately at 2.9% + 30¢ per successful card charge.
2. Paddle: best merchant of record
As a merchant of record, Paddle sells your software on your behalf, collecting the right tax rate, filing returns and handling chargebacks and buyer support for 5% + 50¢ per transaction. There is no lock-in and data can be migrated.
3. Recurly: best for subscription-focused teams
Recurly Starter is $249 per month plus 0.9% of billing volume, with the first $40,000 of monthly billings free of that percentage. Larger companies move to All-Access, quoted below 1% of volume with a $1 million minimum.
4. Chargebee and Lago
Chargebee targets growing B2B SaaS with a free starting option and custom enterprise pricing. Lago is open source and strong for usage-based pricing; Lago Premium adds items such as progressive billing and automatic dunning, priced by quote.
How much does SaaS billing cost? A worked example
Assume $100,000 of monthly subscription revenue across 2,000 payments of $50 each (illustrative):
- Stripe Billing, pay as you go: 0.7% = $700, plus card fees of 2.9% ($2,900) and 30¢ x 2,000 ($600). Total about $4,200. Tax handling is separate.
- Stripe Billing, $620 monthly tier: $620 plus the same $3,500 in card fees, about $4,120.
- Recurly Starter: $249 + 0.9% x ($100,000 – $40,000) = $249 + $540 = $789, plus your payment gateway fees.
- Paddle: 5% x $100,000 = $5,000 + 50¢ x 2,000 = $1,000, total $6,000, but this includes payments, tax compliance, fraud and chargebacks.
The takeaway: Paddle looks pricier on paper, but it replaces tax, compliance and support work you would otherwise pay for separately.
How do you choose SaaS billing software?
- Decide who is the seller of record. If you do not want to register for sales tax and VAT globally, a merchant of record fits.
- Model your fees at 2x revenue, not just today.
- Check usage-based billing support if you price per seat plus usage.
- Look at dunning and revenue recovery, which can reduce involuntary churn.
Related: best order management software.
Which SaaS billing platform fits your stage?
Illustrative fee maths at two revenue levels, assuming $50 average payments (so 400 payments at $20K and 10,000 at $500K), using card fees of 2.9% + 30¢ for Stripe. Negotiated rates at scale will differ.
| Option | $20K monthly volume | $500K monthly volume |
|---|---|---|
| Stripe Billing pay as you go (0.7%) | $140 | $3,500 |
| Stripe Billing monthly tier | $620 (not worth it at this size) | $2,950 (cheaper than pay as you go) |
| Stripe card fees (separate) | $700 | $17,500 |
| Recurly Starter ($249 + 0.9% above first $40K) | $249 | $4,389 |
| Paddle (5% + 50¢, all-in) | $1,200 | $30,000 |
At $20K, Stripe Billing plus cards is about $840, versus Paddle at $1,200, so the merchant-of-record premium is about $360 for tax, compliance and chargeback handling. At $500K the gap is much wider, which is why scaled companies often negotiate or move to platforms with volume pricing.
What features should SaaS billing software have?
- Flexible pricing models: flat, per-seat, tiered, usage-based and hybrid.
- Trials, coupons and plan changes with automatic proration.
- Dunning and smart retries to recover failed payments.
- Tax calculation and compliance (sales tax, VAT, GST).
- Invoicing and customer portal.
- Revenue recognition and reporting: MRR, churn, LTV.
- Integrations: CRM, accounting, data warehouse.
How do you choose by company stage?
- Pre-revenue to early traction: Stripe Billing pay as you go, or Paddle if you do not want to handle global tax.
- Scaling B2B with sales-led contracts: Chargebee or Recurly, which suit invoicing and complex plans.
- Usage-based or AI products: Lago or Stripe’s usage-based tools.
- Heavy data control or self-hosting needs: Lago open source.
Migration checklist
- Export customers, subscriptions and payment method tokens (ask your processor about token migration).
- Map plans, add-ons and coupons.
- Run a parallel period with test accounts.
- Move renewals gradually so billing dates do not change unexpectedly.
- Reconcile revenue reports after the first full billing cycle.
Common mistakes
- Forgetting that payment processing is billed separately from billing software fees.
- Ignoring tax registration obligations when selling globally.
- Skipping dunning setup, which leaves recoverable revenue on the table.
SaaS billing software: pros, cons and who each platform suits
The best SaaS billing software depends on who should be the seller of record and how your revenue is priced. These trade-offs use only the published fees above.
Stripe Billing for SaaS billing
- Pros: 0.7% pay-as-you-go with no recurring fee, and fixed monthly tiers if you commit for a year.
- Cons: card processing (2.9% + 30¢) is billed separately and tax handling is separate.
- Skip it if you want someone else to be the legal seller.
Paddle for SaaS billing
- Pros: merchant of record that handles tax, fraud and chargebacks for 5% + 50¢ per transaction.
- Cons: the all-inclusive fee looks high on paper, and products under $10 need bespoke pricing.
- Skip it if you already handle global tax yourself.
Recurly for SaaS billing
- Pros: subscription-focused, Starter at $249 a month plus 0.9% above the first $40,000 of monthly billings.
- Cons: you pay gateway fees on top, and All-Access needs a $1 million volume minimum.
- Skip it if you are pre-revenue.
Chargebee and Lago for SaaS billing
Chargebee targets growing B2B SaaS with a free starting option and custom enterprise pricing, though its details varied on the page we checked. Lago is open source and strong for usage-based pricing, with Premium priced by quote.
In short, Stripe Billing is the default for startups, Paddle removes tax work, and Recurly suits subscription-heavy businesses at scale.
Final verdict: the best SaaS billing software for your stage
The best SaaS billing software is the one that fits your tax and payment setup. For most startups, Stripe Billing is the best SaaS billing software to start with because pay as you go has no recurring fee. If you do not want to register for sales tax and VAT in every country, Paddle is the best SaaS billing software to evaluate, since it acts as merchant of record. For subscription-heavy companies, Recurly is the best SaaS billing software to price at scale. Model the fees of any SaaS billing software at twice your current revenue, and remember that payment processing is billed separately from billing fees.
SaaS billing software: frequently asked questions
What is the best SaaS billing software?
Stripe Billing is the best default for startups, Paddle for global tax compliance, and Recurly for subscription-heavy businesses.
How much does Stripe Billing cost?
Stripe Billing charges 0.7% of Billing volume on pay as you go, or from $620 per month on a one-year contract for up to $100,000 in volume. Payment processing fees are separate.
What is a merchant of record?
A merchant of record is the legal seller of a product, responsible for collecting and remitting sales tax, handling chargebacks and providing buyer support. Paddle acts in this role.
Is there open-source SaaS billing software?
Yes. Lago offers an open-source option, with a paid Premium tier available in the cloud or self-hosted.
Is Paddle more expensive than Stripe?
On list fees, yes: Paddle is 5% + 50¢ per transaction all-in, while Stripe Billing is 0.7% plus separate card fees. Paddle includes tax compliance, fraud and chargeback handling, so compare total cost of ownership.
Does Recurly include payment processing?
Recurly lists $249 per month plus 0.9% of billing volume above the first $40,000; you pay your payment gateway fees separately.
When do Stripe Billing monthly tiers beat pay as you go?
In the worked example above, the $2,950 tier beats 0.7% pay as you go ($3,500) at $500K monthly volume, while the $620 tier is not worth it at $20K.
Can I self-host SaaS billing software?
Yes. Lago has an open-source option, and Lago Premium is available in the cloud or self-hosted.
Pricing sources, as read in October 2026: Stripe Billing, Recurly, Paddle, Chargebee and Lago.
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