When a client's card fails, this is what happens next.
When a card fails, Stripe retries it on its own schedule and marks the subscription past due; the client is not emailed unless that is switched on in Stripe. This is Stripe dunning, and most of it runs without you. This guide walks through each step, what a failed payment means for the rep's commission, what LetSign adds on the Team plan, and what to do by hand.
What Stripe does, step by step.
Every fact below comes from Stripe's docs, checked 9 Oct 2026, with the page linked in each step. Your own Dashboard settings decide the numbers.
The first charge fails and the subscription goes past due
Stripe attempts the renewal, the card declines, and the invoice stays open. On the subscription statuses page, Stripe says past due means payment on the latest finalised invoice either failed or was not attempted. The subscription keeps creating invoices, and Stripe might retry while it is past due, but that status does not guarantee another attempt.
Stripe smart retries kick in
If Smart Retries is on, Stripe picks the times it thinks are most likely to succeed. On the Smart Retries page Stripe says you set a number of tries within 1 week, 2 weeks, 3 weeks, 1 month or 2 months, and that the recommended default is 8 tries within 2 weeks. If the issuer returned a hard decline, such as a lost or stolen card, the retries are scheduled but only run once a new payment method is on file.
The client hears about it only if you turned emails on
Stripe does not tell the client by itself. On the customer emails page Stripe says you enable Send emails when card payments fail in the revenue recovery settings, and that once enabled it emails the client after each failed payment with a link to update their payment method. Leave it off and the client may not know anything happened.
The retries run out
After the final attempt Stripe makes no further attempts. The Smart Retries page lists what happens next, according to the setting you chose: cancel the subscription, mark it unpaid, leave it past due, or pause it if it is eligible. Each takes effect after the maximum number of days in your retry schedule.
Cancelled or unpaid
On the statuses page Stripe says an unpaid subscription keeps generating invoices but does not attempt payment, and recommends you revoke access at that point. Cancelled is a terminal state: collection stops on all unpaid invoices and the subscription cannot be updated. To win the client back you collect a new card and start a new subscription.
Why it matters: involuntary churn.
Involuntary churn is a client who wanted to stay but left anyway. Their card expired, the bank replaced it after a fraud alert, or the limit was hit on the wrong day. Nobody decided to cancel. The subscription ended because a charge failed and nobody fixed it in time. That is a different loss from a client who chose to go, and it is the one you can usually get back with a short message and a working card.
The industry term for the work of chasing those failed charges is dunning management: retries, emails, and an easy way to update the card. Stripe handles the retry half well. The human half, a note from the person the client actually knows, is where small teams win or lose the client. Failed payment recovery is mostly about speed and tone, not tooling.
What LetSign does today.
Churn exceptions on Team
When a subscription paid through your connected Stripe churns because a payment failed, LetSign flags it as a churn exception, apart from a client who chose to leave. The rep's commission clawback can be waived in one step, and the waiver is recorded as a signed adjustment. See commissions on Team.
On LetSign Team: the nudge
A nudge to the client when a card fails is part of the Team plan. Stripe's own failed-payment email goes first; LetSign follows up with a card update link, and you can retry the charge now or pause collection while you sort it out. After a second declined card, the deal moves to Act now and its owner is emailed. Every action shows the exact email and runs only when you confirm.
LetSign reads the failed payment, the retries and the final status straight from Stripe, on each webhook and again nightly. LetSign never holds the money and never adds a late fee. A retry asks Stripe to charge the card again, on your own Stripe account. The clawback decision stays with you.
Doing it by hand.
Turn on Stripe's failed-payment emails
In your Stripe Dashboard, enable Send emails when card payments fail under revenue recovery. Stripe then emails the client after each failed charge with a link to update the card. It is the single cheapest piece of dunning management you can switch on, and it takes a minute.
Send a personal note with the update-card link
The Stripe email is generic. A short note from the person the client knows, with the same update-card link, is what most clients act on. There are ready-to-copy wordings in payment reminder emails. Send it on the day of the first failure, not after the last retry.
Check the churn exceptions queue before closing a pay period
Before you mark a pay period paid, open the churn exceptions list. For each subscription that churned on a failed card, waive the clawback or let it run. Once the period is paid its numbers freeze, and a later change lands as an adjustment in the next period.
Frequently asked questions
How many times does Stripe retry a failed payment?
It depends on the retry policy set in your Stripe Dashboard. Stripe's Smart Retries page says you can retry a specific number of times within 1 week, 2 weeks, 3 weeks, 1 month or 2 months, and that the recommended default is 8 tries within 2 weeks. A custom schedule allows up to three retries, each a set number of days after the previous one.
Can I change the retry schedule?
Yes, in your Stripe Dashboard under Billing, Revenue recovery, Retries. You can keep Smart Retries and adjust the number of tries and the window, or disable Smart Retries and write your own rules. Stripe notes that changing the settings only affects future retries.
What does past due mean for the contract?
Past due is a Stripe status, not a contract status. It means the latest invoice failed or was not attempted; the subscription still exists and still generates invoices, and Stripe may still retry. The contract your client signed is unchanged, and the client's access is a decision you make, not something LetSign changes for you.
Does the rep lose commission when a card fails?
Not automatically. A failed payment does not earn commission because nothing was collected, and if the subscription later churns for that reason LetSign flags it as a churn exception. You then decide: waive the clawback in one step, or let the plan's clawback rule run. That decision lives in the Team plan's commission tools.
Does LetSign email my client when a payment fails?
Yes, on the Team plan. Stripe's own failed-payment email still goes first, when it is switched on in your Stripe Dashboard. LetSign then follows up with the card update link, and you can retry the charge now or pause collection. After a second declined card, the deal moves to Act now and its owner is emailed.
Keep the client. Pay the rep right.
Start free, connect your Stripe, and switch to Team the day you add a rep. Your clients sign and pay. Stripe retries. LetSign keeps the commission ledger honest when a card fails.