Dunning - Declined payment
What's the difference between a declined and failed payment?
When a customer's card is declined by the bank, this means that there is either a lack of funds in the account; the card details are incorrect, or the card has been suspended because it has been marked as lost or stolen.
A failed payment occurs when a customer's card is declined by their bank for a reason that is not their fault, such as a technical error. When this happens, you will want to treat the dunning process differently to when a payment is declined.
What happens if a customer's payment is declined?
With subscription billing it's inevitable that some customer's payments will be declined for some reason or another. When this happens, we transfer the declined payment to the dunning flow you have configured under Settings > Configuration > Dunning and failed payments > Declined.
What is dunning?
Dunning is simply the process of communicating with your customers to ensure the swift collection of a declined or failed payment and what will happen if a reattempt is unsuccessful.
How do I customize my dunning flow for declined payments?
Head to Settings > Configuration > Dunning and failed payments. Under the 'Declined' tab you can customize the initial email notification sent to the customer when their payment is declined and up to three reattempts before cancelling the subscription. If all reattempted payments fail, you will then need to choose how you want to write off the invoice - automatically, manually or scheduled.
How should I configure my hours until reattempt for declined payments?
When configuring your 'Hours until reattempt' for the declined dunning flow, you should take into account that its hours from the initial payment decline.
For example, if you wanted 'Attempt two' to be 3 days after the initial payment decline, the 'hours until reattempt would be set to '72'
How do I customize the emails sent to customers during the dunning flow for declined payments?
Head to Settings > Configuration > Dunning and failed payments. Under the 'Declined' tab, on the right-hand side of 'Initial payment decline' and each reattempt, you will see a 'Customize email' button. Clicking this will allow you to customize the subject line and copy. You can also choose to configure BCC settings so that the necessary people in your company are alerted.
How are minimum terms handled when a customer's payment continues to decline?
If you've set up a minimum term for your plan and your customer's card declines, by default, we will ignore the minimum term and will continue the dunning flow, with regards to write-offs as per your dunning settings (Settings > Configuration > Dunning and failed payments). You can though choose to have us issue a new invoice for the unpaid balance and add minimum term fees - we would then write off the original invoice. Just hit the 'Invoice minimum term' toggle in the 'Handling minimum terms' section of your dunning settings.
Do unpaid one time charges enter the dunning flow?
No, one time charge payments aren't reattempted automatically and do not enter your dunning flow like subscription payments do.
If a one time charge payment fails, you will have to manually reattempt the transaction. This can be done by heading to the one time charge's invoice and clicking the 'Reattempt' button. You can also reattempt an invoice using our API with the Reattempt invoice payment request.
Updated 9 months ago