> For the complete documentation index, see [llms.txt](https://developer.paddle.com/llms.txt).

# Subscriptions paid by invoice now move to past due

Manually-collected subscriptions now become past due when payment terms against invoices for subscription renewals elapse.

---

## What's new?

We updated the Paddle platform so that [manually-collected subscriptions](https://developer.paddle.com/concepts/sell/sales-assisted-invoice.md) now become past due when renewal invoices aren't paid within the payment terms.

There are no changes to endpoints or fields in the API as a result of this change — it's an update to the way the Paddle platform handles manually-collected transactions.

## How it works

In Paddle, you can bill for [subscriptions](https://developer.paddle.com/api-reference/subscriptions/overview.md) automatically using a saved payment method or manually by invoice:

- **Automatically-collected subscriptions**

   Paddle collects using a saved payment method. If no payment method is saved, customers must enter one using [Paddle Checkout](https://developer.paddle.com/concepts/sell/self-serve-checkout.md). Typically part of a self-service workflow.

- **Manually-collected subscriptions**

   Paddle collects by [sending an invoice](https://developer.paddle.com/concepts/sell/sales-assisted-invoice.md) that the customer must pay by bank transfer or using Paddle Checkout. Typically part of a sales-assisted invoicing workflow.

When payment fails for a subscription renewal transaction for an automatically-collected subscription, Paddle sets `subscription.status` to `past_due`. [Paddle Retain](https://developer.paddle.com/build/retain/set-up-retain-profitwell.md) gets to work to automatically recover the payment for you. This process is called dunning.

Manually-collected transactions (invoices) become past due when payment isn't received by the time the payment terms elapse. Previously, when transactions for manually-collected subscription renewals became past due, the related subscription `status` in Paddle remained `active`.

With this update, when a subscription renewal for a manually-collected subscription becomes overdue, the subscription in Paddle becomes `past_due`. This makes the behavior between automatically and manually-collected subscriptions consistent. You can build your own workflows to keep on top of overdue manually-collected subscriptions.

{% callout type="info" %}
[Paddle Retain](https://developer.paddle.com/build/retain/set-up-retain-profitwell.md) payment recovery is designed for automatically-collected subscriptions, automatically reducing delinquent churn from payment failures. As customers pay manually-collected subscriptions themselves, Paddle Retain doesn't take any action when they're past due.
{% /callout %}

## Next steps

This change is available now.

Subscriptions paid by invoice are typically for bigger dollar business-to-business enterprise deals. If you've [built a workflow to restrict access to your app for subscriptions that are `past_due`](https://developer.paddle.com/build/lifecycle/subscription-renewal-dunning.md), you might like to exclude manually-collected subscriptions from this.