UK small businesses are being urged to review their software subscriptions as the growing use of AI tools adds to recurring costs and increases the risk of so-called SaaS creep.
Subscriptions have become an essential part of running a business, covering areas such as accounting, cybersecurity, and marketing. The rise of AI has accelerated adoption, with more than half (51%) of small businesses now using AI-powered tools to automate tasks, analyse data, and support customer service.
However, adding digital solutions can quickly increase the number of recurring payments a business must manage. Free trials can automatically convert into paid plans, while software purchased for one-off projects can remain active long after it is needed.
Although individual monthly charges may seem small, multiple subscriptions can collectively cost businesses thousands of pounds a year, reducing cash flow that could otherwise support hiring, product development, or cash reserves.
Regular subscription audits can identify unnecessary costs
Rebecca Alford, Chief Financial Officer at Capital on Tap, highlights the issue: “Founders are always looking for ways to improve their business, so investing in software that promises to drive growth is understandable. The challenge is ensuring these tools continue to deliver value even when new platforms emerge, as businesses can end up paying for multiple platforms with overlapping functionality when fewer solutions may achieve the same results.”
“That’s why carrying out a subscription audit every few months can make a real difference. The aim isn’t simply to cut costs; it’s to make sure every subscription is actually needed.”
Before renewing any service, ask these four key questions
- Is this tool still being used regularly?
- Does another platform we pay for already provide the same functionality?
- Are we paying for unused licences or premium features nobody uses?
- What would happen if we cancelled it tomorrow? (If the impact on day-to-day operations is minimal, cut it.)
One of the simplest ways to identify unnecessary spending is to review recurring payments across business bank accounts and credit cards. This can reveal forgotten subscriptions, including free trials that have converted into paid plans, software purchased for one-off projects, and licences that are no longer required.
Businesses should also check payment methods, renewal dates, and pricing plans. Software providers regularly introduce new packages, update features, and offer discounts for annual billing, creating opportunities to reduce costs without sacrificing functionality.
Keeping subscriptions organised can give founders a clearer view of their finances, helping them forecast cash flow, avoid unexpected renewal charges, and make better-informed spending decisions.
Test software before committing
Before taking out a new subscription, businesses should establish what the software offers and whether it addresses a genuine business need.
Many providers offer free trials, product demonstrations, and onboarding sessions, allowing teams to assess software before making a financial commitment. Testing a platform first can reduce the risk of paying for tools that go unused while helping employees adopt new software more quickly.
Employee feedback should also be considered before purchasing a subscription. A platform may appear to be an ideal solution from a founder’s perspective, but if employees find it difficult to use or continue relying on other tools, its value can quickly decline.
“Industry observers note that poor management of software licences often leads to substantial waste, with unused seats and overlapping tools common across firms of all sizes. Regular reviews help small businesses reclaim control, especially as AI-powered platforms proliferate and add further layers of recurring costs.”
By focusing on genuine business needs, regular usage, and licence reviews, small businesses can reduce unnecessary expenditure while continuing to benefit from digital and AI tools.
Capital on Tap advises that organised subscription management can also support more accurate financial planning, helping businesses direct resources towards growth instead of allowing overlooked monthly charges to accumulate.