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

# Payment Recovery

Send optimized payment failure notifications, automatically retry payment methods, and show frictionless payment recovery forms in your app or website.

---

Payment failures for a subscription are the most common form of churn for SaaS businesses. Payment Recovery, part of [Paddle Retain](https://developer.paddle.com/concepts/retain/overview.md), automatically recovers subscriptions that are at risk of churning because of payment failure and expired payment methods.

You don't need to set up complicated retry logic or spend hours writing email templates to use Payment Recovery — we've analyzed billions of datapoints to optimize payment retries and notifications for you. You can [integrate with Paddle Billing](https://developer.paddle.com/build/retain/set-up-retain-profitwell.md) in a couple of clicks, with no additional scripts required.

{% card-group cols=3 %}
{% card title="recovery rate for failed payments" stat="50%+" statColor="blue" %}
Paddle Retain has the highest payment recovery rate on the market.
<!-- https://www.paddle.com/retain/failed-payment-recovery -->
{% /card %}

{% card title="overall cut in involuntary churn" stat="17%" statColor="green" %}
Optimized retries and notifications reduce churn without any intervention.
<!-- https://www.paddle.com/retain/failed-payment-recovery -->
{% /card %}

{% card title="factors used for optimized retries" stat="15+" statColor="purple" %}
Boost recovery success with optimized timing based on 15+ datapoints.
<!-- https://www.paddle.com/resources/payment-failure -->
{% /card %}

{% card title="Automatic payment retries" %}

Retain automatically retries failed payment methods over a 30-day window.

{% /card %}
{% card title="Frictionless payment method update" %}

Customers can securely update their details without logging in to your app.

{% /card %}
{% card title="Multichannel notifications" %}

Send whitelabeled payment recovery notifications by email, in your app, and by SMS.

{% /card %}
{% /card-group %}

## How it works

Involuntary churn happens when a customer unintentionally drops a subscription because of a problem with their [payment method.](https://developer.paddle.com/concepts/payment-methods/overview.md) It typically happens when payment fails for a subscription renewal and it's automatically canceled before the next billing period starts.

Payment Recovery, part of Paddle Retain, gets to work to automatically recover failed payments for you. This process is called dunning. By default, dunning takes place over a 30-day period.

While other solutions simply retry payments, Payment Recovery is built on top of algorithms that use billions of data points to recover failed payments using optimized retry logic, whitelabeled email outreach, and no-login payment method update forms.

With Payment Recovery, you can:

- **Retry payments at the best time for success**  
   Automatically retry payments over the dunning window, and turn on Tactical Retries to retry failed payments at optimal times based on the payment method type, customer location, and other details.
- **Send optimized payment recovery emails**  
   Email customers when a payment fails, with messaging written by experts and optimized across hundreds of thousands of transactions.
- **Push payment recovery notifications**  
   Prompt customers to update expired credit cards when using your web app or landing on your commercial website — securely handled by Paddle.js.
- **Send payment recovery messages by SMS**  
   Reach customers by text message to further boost payment recovery rates.
- **Choose what happens at the end of the dunning period**  
   When all payment recovery attempts are exhausted, Paddle Retain automatically pauses or cancels subscriptions for you.

When a failed payment goes through successfully because of Payment Recovery, a subscription changes from past due to active. The next billing date stays the same, and it renews as normal.

## Customer experience

{% journey %}

{% journey-step title="Payment fails and Retain emails the customer" %}

Payment Recovery sends a short, personal, plaintext email to let the customer know that their payment failed. It includes a prominent link to update their payment method.

If the customer doesn't take any action, Payment Recovery tries the payment method on file again as part of the dunning process and sends an email each time.

{% /journey-step %}

{% journey-step title="Customer gets in-app notifications" %}

As well as payment recovery emails, Payment Recovery notifies customers that they need to update their subscription when they're using your web app or land on your commercial website.

In-app notifications reach customers when they're using your product, maximizing the likelihood of payment recovery.

{% /journey-step %}

{% journey-step title="Retain sends SMS notifications" %}

If you want, you can turn on SMS notifications for payment recovery. Customers receive a text message with a link they can use to update their details.

SMS is a reliable way of reaching customers, with 90% of text messages being read within three minutes of receipt.

{% /journey-step %}

{% journey-step title="Customer updates their details" %}

When customers click the link in an email or SMS from Payment Recovery, they're taken to a page on your website to enter updated information. They don't need to log in.

Digital wallets like Apple Pay, Google Pay, and PayPal are presented, making payment method update quick and easy.

When a failed payment goes through successfully, a subscription changes from past due to active.

{% /journey-step %}

{% /journey %}