Smarter recovery for failed subscription payments

Changed

• Payday-aware renewals. A renewal is charged on its renewal date, or on the customer's next payday when one falls within 3 days after that date — never earlier. Paydays follow the country in the customer's shipping address.
• Charged in the customer's local time. Renewals and retries run at your store's billing hour in the customer's local time, 14:00 by default, not at the time of day the customer first checked out. The next renewal date is still counted from the renewal date, so the cycle doesn't drift.
• Retries 2, 5 and 8 days after a decline. A renewal declined for insufficient funds or a general decline is retried 2, 5 and 8 days after the first decline — 4 attempts in total, or fewer if Max attempts is lower. Temporary processing errors are retried 1, 2, 3 and 4 days apart, waiting at least as long as the card network asks. Lost, stolen, closed or expired cards, and banks asking for authentication, are not retried automatically.
• One attempt per card per 24 hours. At most one automatic attempt is made on a card in any 24 hours, across every subscription on that card, whichever retry strategy your store uses.
• Past due instead of cancelled. When the last retry fails, the subscription stays Past due, nothing more is charged automatically, and the customer receives up to 4 requests to update their payment method, at least 3 days apart. Updating the card retries the payment immediately. This applies to both retry strategies.
• Reminder 3 days before each renewal. The pre-renewal reminder now goes out 3 days before by default. It shows the amount and date, asks the customer to make sure their card has enough available, and links to update the payment method, skip, pause and manage — and to cancel, unless your store runs a cancellation flow.
• Clearer failure emails. After a failed attempt, the customer is told when we'll try again — and, for insufficient funds, to make sure funds are available or switch cards. Before the final retry, they are told the subscription will be put on hold, not cancelled, if it fails.
• Recovery discount on the final retry. Offer discount after N failures now defaults to 3, so an enabled recovery discount applies to the final retry.
• Renamed settings. Target retry hour (UTC) is now Billing & retry hour (customer's local time), and Auto-cancel after retries exhausted is now Cancel when a declined card is never replaced. With it on, a subscription is cancelled only after a permanent decline and 4 unanswered update-payment-method requests.

Good to know

• Dunning emails must be on. Failure, retry and card-update emails are sent only when Dunning emails is on in Subscriptions → Settings → Billing engine emails.
• Smart AI retry. Payday timing and the 2, 5 and 8-day schedule apply to stores using the Smart AI retry strategy. The Fixed schedule strategy keeps your own list of retry days.
• Customers can still cancel at any time while a subscription is past due.

Guide: Failed subscription payments.