Subscription payments in 2026: what works now for merchants?

Patricia Choy, Global Payment Partner Manager at Deezer, discusses the rise of subscription payments in Europe and the role of schemes in driving growth into this business model in 2026. 

Let’s start with a simple question - how many subscriptions do you have right now? It’s very likely that you have one for music, video streaming, sports, food delivery, public transport, mobile plan, home Internet, electricity, cloud storage, cinema pass, and then some. Most of us are probably subscribed to more services than we realise, which speaks volumes about how deeply subscription models have shaped our everyday life.

Why do we do it? Because subscriptions offer continuous service without friction. The less we have to think about paying, the more seamless and valuable the service feels.

The rise of subscriptions in Europe

The numbers confirm what we experience. Europe's subscription economy generated USD 129 billion in 2024 and is expected to grow over 12% per year this decade, according to the Grand View Research report. The same source mentions that the market is projected to reach USD 369 billion by 2033.

It’s no surprise that more companies adopt this payment model: subscriptions secure revenue, allow long-term customer relationships, and bring the opportunity to monetise on up-sales, cross-sales, etc. However, the model brings challenges too, including high acquisition costs, retention expectations, and the constant pressure to innovate and deliver real value so customers stay, not because they forgot to cancel, but because they want to remain.

The scheme role in subscriptions

Behind every successful subscription there is a payment system that quietly works, and sometimes fails in the background. Card expiration, card replacement, or blocked cards, can all cause involuntary churn, even when the customer is perfectly happy.

Beyond retention strategies that every merchant puts in place to reduce involuntary churns, card schemes and payment service providers play a crucial role by offering tools designed to improve continuity and payment success.

For major card providers such as Visa, Mastercard, and American Express, core subscription capabilities include tokenization, where card numbers are replaced with secure tokens to ensure continuity of recurring payments, as well as card updater services that automatically refresh card credentials when a card expires, is lost, or replaced. The impact of this feature depends on issuer adoption, which can vary from one region to another. In markets where adoption is strong, it can make a real difference. Card-expiration declines alone can represent, on average, more than 2% of all refusals, so reducing them can lead to a significant uplift in authorisation rates.

At the same time, each card scheme brings its own set of features that can be particularly helpful for subscription merchants. Without aiming to be exhaustive, here some of the features that work with me:

On Mastercard’s side, Merchant Advice Codes (MAC) are especially valuable when it comes to managing payment refusals. They provide guidance on when to retry a declined transaction by indicating, based on issuer data, when funds or payment availability are more likely to be restored. Thus, rather than applying your default same day retries, a MAC code response may suggest waiting for 24 hours. In practice, this helps merchants build a more precise post-refusal retry strategy to help reduce churn, which is a core operational action for any subscription-based business. However, this response must be adopted by the issuer, so it might work better in some regions than in others. The feature should be accessible via your PSP.

Another useful feature recently launched in Europe is the Approval Probability Indicator. It provides a predictive signal on the likelihood of authorisation across future time windows, helping subscription merchants decide not just if but when to retry a declined charge. There is potential beyond retries, especially for merchants offering free of charge or discounted trial periods, as it could help anticipate whether a user who is initially onboarded is likely to successfully convert when the first full-price charge occurs. Given generally high acquisition costs in subscriptions, having a directional signal on the likelihood of positive ROI is worth exploring.

Another useful feature is VISA’s BIN Attribute Sharing Service, which allows merchants and payment providers to access key card characteristics based on the BIN, such as card type, country of issuance, and whether the card supports recurring payments or account updater services, among others. A concrete use case could be identifying BINs associated with disposable cards to decide whether those payment methods should be granted access to a free or discounted trial or used to redirect the user toward a more suitable non-recurring product. More broadly, BIN-level insights can be leveraged to optimise routing and costs, refine fraud and SCA strategies, and tailor checkout and retry flows based on issuer characteristics. This service should be accessible directly with Visa or through your PSP.

When moving from scheme-level capabilities to local realities, country specificities quickly come into play. In France,  the particular co-branded card ecosystem includes international schemes – VISA or Mastercard – and Carte Bancaire (CB), a domestic network created in 1984 by most French banks. In a subscription context, this means that alongside features such as account updater services CB also provides Fast’R, a real-time scoring mechanism that helps issuers assess the legitimacy of online transactions before authorisation, which could prove an interesting add-on when managing recurring payments in the French market. 

Towards a more collaborative ecosystem

At the end of the day, the beauty of subscriptions is simple – a continuous, smooth service that requires little effort from the customer and that allows merchants to secure revenue. Technology helps, but trust is what sustains the relationship. Clear communication, transparent pricing, and easy cancellation are just as important as a frictionless payment flow.

Looking ahead, there is still plenty of room for innovation, and if I had to share a personal wish list of what could come next, it would start with more predictive, subscription-native tools. A unified, cross-scheme subscription health score combining signals such as updater coverage, recent decline patterns, and chargeback probability could help merchants act proactively, not only before a payment fails, but also before a user is fully enrolled. There is also strong value in a more consistent, cross-scheme payment refusal reasons framework, with clearer and more actionable decline reasons from issuers that help refine post-refusal strategies and avoid unnecessary retries. Finally, alternating between multiple issuers could play a more active role by explicitly preventing disposable cards from being used for subscriptions, while guiding cardholders toward more suitable payment methods, improving transparency for users and long-term sustainability for subscription merchants.

The subscription industry is set to continue growing, and while many scheme-level functionalities adapted to recurring payments already exist today, the bar keeps rising as customer expectations become more demanding. Strong collaboration and coordination between card schemes, issuers, acquirers, and payment service providers will be key to making these tools more accessible, operational, and impactful ultimately strengthening the subscription model for both users and merchants alike.

 

About Patricia Choy

Patricia is Global Payment Partner Manager at Deezer, specialising in global payment partnerships and optimisation. She works with partners worldwide to improve payment performance, drive innovation, and support business growth across markets. With extensive experience in digital payments and cross-functional collaboration, she helps companies turn payments into a practical lever for conversion, customer experience, and sustainable revenue growth.

 

About Deezer

Deezer is one of the world’s largest independent music experiences platforms, connecting fans with artists and creating ways for people to Live the music. The company provides access to a full-range catalog of high-quality music, lossless HiFi audio and industry-defining features on a scalable platform available in 180+ countries.