Credit card decline is one of the main reasons for subscription business churn.

The vast majority of businesses I’ve talked to are doing way too little to fix it.

Fundamentally, there’s two types of churn. The first is active churn, which is customers intentionally canceling. The second is passive churn, which is customers canceling because their credit card declines when you attempt to rebill them.

Passive churn can be, in my experience, up to 40% of cancellation. It’s also especially frustrating because these are usually people who want to continue to be your customers!

After a customer’s payment is declined, there are a few things you can and should do to keep them as a customer.

The first is letting the customer know immediately that their card has declined and they need to do something about it. I recommend emailing the customer at least once a day for up to a week to attempt to get them to update their card.

This isn’t spam. Customers on a subscription are presumably using your product regularly and need to be told if their delivery is going to be interrupted. They can choose to actively cancel if they don’t want to be on a subscription anymore.

After a week or so, I’d take the email cadence down to once a week so the emails don’t get lost or marked as spam.

The next approach is re-attempting their payment. Visa and Mastercard have recently limited retry attempts to 15 within the first 30 days of the initial payment failure. First, you should retry their card once per day (but no more than once per day) for 3-5 days after missed payment.

After that, certain days of the week and month are much more likely to have successful retries, mostly because they are days in which people are paid. Fridays, 1st of the month, 15th of the month, and the last day of the month are almost always the best days.

You shouldn’t push this too far, though. If a customer does not reactivate their card after two weeks or at most four weeks, they are less likely to be a customer that wants to continue their subscription. Retrying their card after this point can get you in trouble with credit card companies and at some point it’s not the right thing to do.

There are various companies that help with this including Churnbuster, ProfitWell, and RevRecap. DM if you want a recommendation on which one to use–it depends on your situation–but I definitely would use one of them or do it yourself. Definitely don’t just stick with your native subscription platform’s retry process.