Automated payment recovery

Intelligent dunning logic that maximizes subscription revenue recovery and keeps subscriptions active through cycle-based retry scheduling and customer communications.

Dunning is Airwallex's automated payment recovery system that retries failed subscription payments using intelligent logic to maximize revenue recovery while maintaining a positive customer experience. Understanding dunning is important when managing recurring payments, as it helps you reduce involuntary churn and maintain subscription continuity without manual intervention.

When a subscription payment fails—due to insufficient funds, expired cards, or temporary processing issues—dunning automatically initiates a recovery cadence tailored to your subscription frequency. This prevents revenue loss from payment failures that customers often don't notice or can easily resolve.

Dynamic retry schedules

Airwallex applies variable retry schedules based on subscription cycle length, optimizing both the timing and frequency of recovery attempts. This approach recognizes that different subscription models require different recovery strategies.

The system categorizes subscriptions into three cycle types:

Subscription cycle	Retry logic/interval	Dunning window duration	Total attempts
Daily (1 day)	One retry at T+2 hours	2 hours	2
Short (2-6 days)	Retries every T+1 day	Cycle length - 1 day	Up to 6
Long (≥ 7 days)	Retries every T+2 days	Up to 14 days	Up to 8

For daily subscriptions, the narrow 2-hour window reflects the urgency of resolving the issue before the next billing cycle. Short-cycle subscriptions receive daily retry attempts within their billing period, while long-cycle subscriptions space retries across two weeks to avoid excessive retry frequency.

This cycle-aware logic balances revenue recovery with customer experience, preventing notification fatigue while maximizing the chances that temporary payment issues resolve naturally.

Customer communications

A payment attempt precedes every dunning email sent to the customer. This ensures customers receive notifications after each failed attempt, not before, creating a logical communication flow that prompts action only when necessary.

Dunning emails inform customers that their payment method requires attention and provide clear paths to update their payment details. The timing of these notifications aligns with retry attempts, so customers aren't overwhelmed with messages while the system attempts automatic recovery.

Anti-overlap safeguard

To protect both business operations and customer experience, Airwallex implements an anti-overlap safety cap that prevents concurrent dunning cadences for the same subscription.

The system strictly caps the dunning window for any cycle to end at least one full day before the next renewal date. This prevents the scenario where dunning cadences overlap for multiple invoices generated for the same subscription, which creates confusion for customers and complicates your reconciliation processes.

For example, if a subscription renews on the 15th of each month and a payment fails, the dunning window would end by the 14th (prior to the next renewal) to ensure clean separation between billing cycles. This safeguard ensures a cleaner customer experience and simpler operational management.

Subscription status transitions

When an automatic payment attempt fails, the subscription status immediately changes to UNPAID. Airwallex then automatically triggers the appropriate dunning cadence based on the subscription cycle.

If any payment retry succeeds during the dunning window, the subscription status instantly moves back to ACTIVE, and billing continues as normal with no gap in service. This seamless recovery maintains subscription continuity without requiring customer or merchant intervention.

If all retries fail, Airwallex takes a final action based on your configured billing settings:

The subscription remains as UNPAID, allowing your team to follow up manually with the customer.
The subscription moves to CANCELLED status, stopping all future billing attempts.
The invoice remains open unless manually marked VOID.

These configurable outcomes give you control over how aggressively the system handles persistent payment failures, allowing you to balance automated recovery with manual intervention based on your business model.

Configuration options

Airwallex provides flexibility in dunning configuration to accommodate different business needs. While the standard cycle-based schedules work for most scenarios, custom retry schedules are available upon request and configured by the Airwallex team.

Dunning cadences only trigger for invoices where the payment setting is to automatically charge. Manual payment invoices bypass the dunning system, as they require explicit customer action rather than automated recovery attempts.