Subotiz supports refunds and an automatic payment retry mechanism called Smart Retry for subscription payments.
This article explains how refunds work without canceling a subscription and how Smart Retry automatically retries failed recurring payments to improve payment success rates.
Refund Handling
In Subotiz, issuing a refund does not automatically pause or cancel a subscription.
This behavior is designed for scenarios where merchants want to compensate customers or adjust billing while allowing the subscription to continue.
The following refund handling rules apply:
- Full or partial refunds are supported: Merchants can issue either a full refund or a partial refund based on the billing situation.
- Refunds do not affect subscription status: Even if an invoice has been refunded, the subscription remains active and continues running according to its configured billing cycle.
- Invoice-level records: Each refund is linked to the corresponding invoice and subscription contract, allowing merchants to review complete records in the admin panel.
- Refund initiation methods: Refunds can be initiated directly from trade orders in the admin panel or executed through the API.
Automatic Payment Retry
When a recurring subscription payment fails, Subotiz automatically activates the Smart Retry mechanism to improve payment success rates and prevent subscriptions from being terminated prematurely.
In most cases, the system attempts multiple retries after a payment failure, typically up to four attempts. The retry schedule may be dynamically adjusted based on factors such as the failure reason, the customer’s time zone, and historical payment behavior.
If any retry attempt succeeds, the subscription continues running according to its original billing cycle.
Smart Retry Strategy
Smart Retry optimizes retry timing using several signals to increase the likelihood of successful payments, including:
- Failure reason analysis: The system evaluates error codes returned by the payment provider to determine whether retrying is appropriate.
- Time-of-day optimization: Retry attempts avoid late-night periods or times with historically low payment success rates.
- Business-day adjustments: If a retry would occur during weekends or non-business hours, the system may adjust the timing.
- Pay cycle optimization: In some regions, retries may be scheduled closer to common salary payment dates to improve success rates.
- Time zone detection: Retry timing is adjusted based on the customer's country or the store’s configured time zone.
These strategies help reduce ineffective retries while improving overall payment recovery rates.
Handling Different Failure Types
The system classifies payment failures into different categories and applies different retry strategies.
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Soft declines: Soft declines are typically temporary issues, such as:
- Network interruptions
- Temporary bank system unavailability
- Insufficient account balance
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Hard declines: Hard declines typically indicate definitive rejection reasons, such as:
- Expired payment card
- Closed bank account
- Explicit rejection by the issuing bank
If a later retry returns a different error type, the system reevaluates the retry strategy based on the new failure reason.
After All Retries Fail
If all retry attempts fail, the system proceeds according to the subscription and billing configuration. Possible outcomes include:
- Waiting for the customer to update the payment method
- Entering the dunning or payment recovery process
- Terminating the subscription according to the subscription rules
The exact behavior may vary depending on the subscription configuration and system policies.
Platform Defaults and Configuration
- Automatic retry enabled by default: All recurring subscriptions have automatic payment retry enabled by default. No additional configuration is required.
- Custom retry rules supported: Merchants can configure custom retry strategies for specific pricing plans. Products without custom settings follow the system’s default retry rules.
Custom Retry and Dunning Strategies
In addition to the default Smart Retry mechanism, merchants can define custom retry and subscription recovery strategies, such as specifying how subscriptions should be handled after repeated payment failures.
Related configuration guides:
By configuring retry and dunning strategies appropriately, merchants can further improve payment recovery rates and reduce subscription churn.
Subotiz supports both refunds and automatic payment retries to help merchants manage subscription billing more effectively. Smart Retry improves payment recovery rates while allowing refunds to be processed without interrupting the subscription lifecycle.