A subscription does not earn because a customer said yes, it earns because a charge succeeds every month. Between the two sits invisible machinery that fails more often than people imagine, and every failure looks like a departure.
Definition
Recurring billing is the automatic charging of an amount at regular intervals, based on an authorisation given once by the customer.
It rests on three elements: a stored payment method, a mandate or authorisation, and a schedule managed by your Payment processor.
The path of one charge, and where it breaks
| Step | What can fail |
|---|---|
| Charge triggered | Date drift, double charge |
| Card requested | Expired, over limit, blocked |
| Bank authorisation | Declined, authentication not completed |
| Funds collected | Dispute opened later |
| Invoice issued | Missing mandatory details |
The second row accounts for most failures, and the main cause is mundane: cards expire every three years. Across a subscriber base that means roughly one customer in thirty-six sees their payment method expire each month.
Those failures show up in your numbers as Churn rate although the customer decided nothing. Without a Dunning sequence you lose subscribers who wanted to stay, and wrongly conclude your product disappoints.
What to put in place
- Automatic card updating. Offered by most processors, it recovers part of the expirations with no intervention.
- Advance notice on large amounts. An email a few days before an annual charge sharply reduces disputes.
- A staged retry sequence on failure, rather than immediate cancellation.
- Simple cancellation. A customer who cannot find how to unsubscribe opens a dispute with their bank, which costs far more.
Frequently asked questions
Should I charge on a fixed date or on the signup date?
On the signup date, which spreads your cash and your failures across the month. A grouped charge on the 1st concentrates failures and support requests into three days.
How do I handle a price change?
With written notice and a way to decline by cancelling. Charging more than was agreed without prior information produces Chargeback cases, which cost more than the increase brings in.
Should I issue an invoice for every charge?
Obligations depend on the country and on whether the customer is a business or a consumer. In every case, an invoice accessible from the customer account reduces support requests and disputes: check the details required in your situation.
What about a subscriber who no longer uses the service?
Tell them, even if it costs a cancellation. A customer who discovers after a year that they paid for nothing opens a dispute and speaks badly of you. Warning them costs one subscription, not warning them costs a reputation. Our n8n course shows how to wire those retries and notices to your processor's events, instead of writing them by hand every month.