Billing collection methods

You can set your preferred payment collection method when creating invoices and subscriptions using either the Dashboard or API.

Automatic charging versus manual payments

The collection method determines how Stripe processes the payment for both products. To collect payments for invoices and subscriptions, you can select from these methods:

• Automatic charging
• Manual payments

Set a collection method for an invoice

To set a collection method for an invoice through the Invoicing API, use the collection_method attribute.

• charge_automatically: Lets you automatically charge a customers default payment method to pay invoices.
• send_invoice: Sends an invoice for manual payment. Unlike automatic charging which requires immediate payment, you can give the customer an adjustable payment window. You can use the Hosted Invoice Page and set up email notifications and reminders to facilitate payment.

Set a collection method for a subscription

To set a collection method for a subscription through the Subscriptions API, use the collection_method attribute. If you change the collection method for a subscription, only subsequently created subscription invoices use the new collection method.

• charge_automatically: Tells Stripe to automatically charge your customers default payment method to pay the invoice generated for each billing period.
• send_invoice: Generates an invoice for each billing period, and requires manual payment. Unlike automatic charging which requires immediate payment, you can give the customer an adjustable payment window.

Due dates for manual payment invoices

You can configure the due date for invoices that use the send_invoice collection method to receive manual payments. You can also configure up to three reminders, starting at 10 days before the due date and ending at 60 days after.

You can also take additional action on the subscription 30, 60, or 90 days after an invoice becomes past due. The options are:

Collection methods and failed payments

Depending on the collection method, failed payments generate different subscription statuses and invoice statuses.

Failed subscription payments

Creating a subscription with a payment_behavior of allow_incomplete, and the collection_method set to charge_automatically, immediately attempts payment and marks the subscription status as incomplete if the initial payment attempt doesnt succeed.

Passing a payment_behavior of default_incomplete will always initialize subscriptions with an incomplete status if the first invoice requires payment. The resulting PaymentIntent must be confirmed in a separate request to attempt payment.

For both allow_incomplete and default_incomplete, the subscription becomes active after the first invoice is paid. Subscriptions that dont require payment upon creation (like those that are trialing) will immediately have a status of active. If the first invoice remains unpaid after 23 hours, the subscription is set to incomplete_expired. This status is final and irreversible, voiding the open invoice and preventing future invoices.

Failed recurring charges

If a payment fails or if it requires customer authentication, the subscriptions status is set to past_due and the PaymentIntent status is either requires_payment_method or requires_action.

To manage these scenarios, set up a webhook endpoint and listen to the customer.subscription.updated event so youre notified when subscriptions enter a past_due status:

{
  "id": "sub_E8uXk63MAbZbto",
  "object": "subscription",
  ...
  "status": "past_due",
  "latest_invoice": "in_1EMLu1ClCIKljWvsfTjRFAxa"
}

For these subscriptions, you need to redirect your customers to your application to collect a different payment method, allowing them to complete the payment. You can use an email or a mobile push notification. Stripe provides built-in reminder emails to handle this case, which you can configure in your Dashboard billing settings.

When your customer returns to your application, reuse either your payment failure flow or customer action flow, depending on the status of the associated PaymentIntent. After the payment succeeds, the status of the subscription is active and the invoice is paid.

Failed incomplete subscriptions

When a subscription has a status of incomplete, you can only update attributes that wont result in the creation of an invoice or invoice item, such as its metadata, save_default_payment_method, and description.

If a payment to renew the subscription fails when youve set it to charge automatically, the subscription transitions to past_due and Stripe may mark it as canceled or unpaid (depending on your subscriptions settings) after Stripe exhausts all payment retry attempts.

On the other hand, if the subscriptions collection_method is set to send_invoice, it becomes past_due when its invoice remains unpaid by the due date. If the customer still hasnt paid the invoice after you extend the deadline, Stripe may mark the subscription as canceled or unpaid, which again depends on your subscription settings.

When a subscription has a status of unpaid, Stripe creates future invoices but leaves them as drafts. In this case, you have the option to resend the past due invoice and any created draft invoices to collect payment. Use this feature if youre trying to collect payment for unpaid months (such as when you continue to provide the goods or services related to an unpaid subscription) or leave them closed and unpaid when you stop providing goods or services.

Failed invoicing payments

Invoices not associated with subscriptions that have their collection_method set to charge_automatically and auto-advancement disabled, remain open if an initial payment attempt fails. Because auto-advancement is disabled, Stripe doesnt automatically close the invoices, retry them, or transition them to a different status. Learn more about failed payment notifications and managing invoices sent to customers.

If auto-advancement is enabled for the invoice, Stripe may automatically mark the invoice as uncollectible (depending on your invoice status settings) after Stripe exhausts all payment retry attempts.

When the collection method is set to send_invoice, the invoice requires manual payment. If the invoice remains unpaid past the due date, the status becomes past_due, indicating an overdue invoice. If you extend the payment deadline and the customer still hasnt paid, you can leave the invoice as past_due or transition it to uncollectible or void.

Enterprise clients and wire transfers

For enterprise clients, manual payment methods, such as wire transfers, offer some advantages. These payment methods often involve more rigorous tracking and reconciliation processes compared to automated methods, which is crucial for enterprises that deal with high transaction volumes. By setting the collection_method to send_invoice, you can generate clear and well-documented invoices that enterprise clients can pay using wire transfersa commonly preferred payment method for this type of client.