Payment Processing
Payment processing is the handling of customer payments from authorization through collection and settlement. In a subscription business it covers charging customers on schedule, collecting recurring and usage-based payments, and recording them against invoices, so cash is collected reliably and on time.
Key Takeaways
- Covers authorizing, collecting, and settling customer payments.
- For subscriptions, it means reliable recurring and usage-based collection.
- Tightly linked to billing: the invoice defines the charge, processing collects it.
- Automating it reduces late payments and days sales outstanding.
How payment processing works in CSP
Once an invoice is generated, payment processing charges the customer through the agreed method, confirms settlement, and records the payment against the invoice. Automating this closes the loop between billing and cash collection so recurring revenue is collected without manual chasing.
Why it matters for Microsoft CSPs
CSP revenue is recurring, so collection has to be as reliable as billing. When invoicing and payment are connected, partners shorten the time from billing to cash and reduce the manual work of reconciling payments.
How Work 365 supports this
Work 365 connects billing to payment collection so recurring charges are collected and reconciled automatically. See Billing and Invoicing.
Related terms: Billing Automation, Subscription Management, Provider Invoice.
FAQ
How is payment processing different from billing?
Billing determines what a customer owes; payment processing collects and settles it.
Why automate payment collection in CSP?
Because recurring revenue depends on reliable, on-time collection, and manual chasing does not scale.
