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B2B SaaS Companies: Avoiding Failed Payments

Blog post from Basis Theory

Post Details
Company
Date Published
Author
Basis Theory
Word Count
1,001
Company Posts That Month
8
Language
English
Hacker News Points
-
Post removed?
No
Summary

Failed payments, especially in subscription and installment businesses, undermine expected revenue and can disrupt financial forecasts more seriously than isolated failed purchases. They may result from insufficient funds, expired, lost, or stolen cards, inaccurate customer information, or processor outages. Merchants can reduce failures through accurate merchant classification and subscription labeling, account-updater services, transparent customer billing terms and cancellation options, redundant payment gateways, and pre-dunning communications that remind customers of upcoming charges. When failures occur, businesses can recover revenue by distinguishing permanent hard declines from potentially temporary soft declines, retrying eligible transactions, using dunning messages to prompt customers to update payment details, and offering alternatives such as ACH or backup payment methods. Automated payment systems and token vaults can support these efforts by securely managing payment data, routing transactions among providers, reducing processing costs, and limiting PCI-DSS compliance exposure.

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