Skip to content

Payment Flow

Feature: Payment Integration with Flexible Pricing and Mandates

Draft

Objective

To design a robust payment integration system with flexible pricing options, platform-specific adjustments (web, App Store, Play Store), and a mandate system that includes a buffer to facilitate seamless plan updates and upgrades without creating new mandates.

Key Concepts

1. Define Pricing with Buffer

  • Base Pricing (P1):

    • The starting price for each subscription plan.
    • Includes a buffer amount (e.g., 10-20%) added to the price to allow discounts or offers without requiring mandate adjustments.
    • Example: If the base price is $10, the buffer-adjusted price is $12, allowing up to a $2 discount.

  • Buffer Use Case:

    • Offers or discounts can be applied by utilizing the buffer within the mandate.
    • Example: If a coach is on a $10/month plan but the price increases to $11, the mandate remains valid due to the buffer.

2. Web Pricing (P1)

  • Direct Subscription Model:

    • Pricing for web purchases is set as P1, the base price.
    • The web channel incurs no additional platform fees, making it the most cost-effective channel.

  • Customization Options:

    • Offer flexible pricing tiers for web users (e.g. promotional discounts).
    • Discounts applied on the base pricing use the buffer for easy management.

3. App Store and Play Store Pricing Adjustments

  • Apple App Store Pricing:

    • App Store charges 30% for transactions.
    • Adjusted Pricing: P1 = P2 - 30% of P2
      • Example: If the base price is $10. (P2), the user price in the App Store is calculated as $10 / (1 - 0.30) = $14.29.

  • Google Play Store Pricing:

    • Play Store charges 15% for most subscriptions.
    • Adjusted Pricing: P1 = P3 - 15% of P3
      • Example: If the base price is $10. (P3), the user price in the Play Store is calculated as $10 / (1 - 0.15) = $11.76.

  • Consistency Across Platforms:

    • Prices on the App Store and Play Store must include platform fees while maintaining parity in service offerings.
    • Discounts applied should reflect these adjustments.

4. Mandate with Buffer

  • Mandate Definition:

    • A pre-authorized recurring payment setup between the user and the payment gateway to ensure seamless subscription renewals. (We have to implement this on web based payment flow only)

  • Buffer Inclusion in Mandate:

    • Add a buffer (e.g., 20%) to the mandate value when created.
    • Example: If the subscription price is $10, the mandate value is set at $12 to allow price adjustments or offers.

  • Advantages of Buffer Mandates:

    • Eliminates the need to recreate mandates when prices are updated.
    • Reduces friction for users, avoiding additional authorization steps for price changes.

  • Scenario:

    • Initial mandate created via the web at $10 with a $2 buffer.
    • When the price is updated to $11, the mandate remains valid as it falls within the buffer.

User Stories

  1. As a system administrator,

    • I want to add a buffer to mandates,
    • So that subscription updates or promotional offers don’t require new mandates, simplifying the process.

  2. As a system administrator,

    • I want the app to account for App Store and Play Store fees in pricing,
    • So that I can avoid unexpected charges when user subscribes through different platforms.

  3. As a coach,

    • I want web pricing to be the most competitive,
    • So that I’m incentivized to subscribe directly through the website.

User Flow & Detailed Steps

1. Setting Up Pricing with Buffer:

  • Scenario: Admin configures subscription pricing.
  • Steps:
    1. Admin enters the base price (P1) for each plan.
    2. The system automatically calculates and adds the buffer (e.g., 20%) to the mandate value.
    3. Platform-specific pricing (App Store and Play Store) is calculated using the base price:
      • App Store: P1 = P2 / (1 - 0.30)
      • Play Store: P1 = P3 / (1 - 0.15)
    4. Prices are displayed to users, accounting for platform fees.
  • Outcome: Pricing is consistently set up with a buffer, and platform-specific adjustments are applied.

2. Mandate Creation:

  • Scenario: A coach subscribes to a plan via the web.
  • Steps:
    1. The coach selects a plan and proceeds to payment.
    2. The system creates a mandate for the base price + buffer.
    3. The coach approves the mandate through the payment gateway.
    4. The subscription is activated without requiring further manual payments.
  • Outcome: The mandate includes a buffer, ensuring flexibility for future price updates.

3. Subscription Updates with Mandate Buffer:

  • Scenario: Admin increases the subscription price or adds an offer.
  • Steps:
    1. Admin updates the base price of a subscription.
    2. The system checks if the new price falls within the mandate buffer.
      • If yes, the mandate remains valid, and the new price is applied seamlessly.
      • If no, the system prompts the user to authorize a new mandate. (flow will be added in this for user)
  • Outcome: Most price updates happen without additional user action, ensuring seamless service continuity.

Dependencies

  1. Payment Gateway Integration:

    • Razorpay for mandate creation and recurring payments.

  2. Platform-Specific Adjustments:

    • App Store and Play Store APIs to account for platform fees.

  3. Pricing Database:

    • Store base prices, buffers, and adjusted platform-specific pricing.

Risks & Mitigations

Risk Mitigation Strategy
User confusion about price differences Display platform-specific pricing breakdowns clearly on the payment page.
Buffer amount insufficient for large increases Set buffer percentages high enough to account for foreseeable price adjustments.
Mandate rejection for new prices Notify users in advance of significant price changes and provide easy options to update mandates if needed.