Failed membership payments

This article runs over the process that happens when a membership charge is attempted and fails.

Introduction

When a membership is due to be charged the process that is followed depends on the way the customer is paying:

  • Card payments - we get an instant response from the bank on whether the payment was successful or not
  • Direct debits/ACH - we get notified after a period of time, typically days later, whether the payment is successful or not

Card payments

If a card payment fails then the membership enters a state called "dunning".  This is a term used by the banks to mean the customer should have paid for something but hasn't yet.  You can see the state on the Customer's profile under the Purchases tab.  There'll also be an outstanding payment on their profile:

When this happens WodBoard will automatically reattempt the charge for the next 7 days.  It'll notify the customer each day that the payment has failed (including a push notification to their app) and explain the reason (eg lack of money in bank).  The email explains their membership will cut off and future bookings will be cancelled unless they take action.  In nearly all cases this is enough for the customer to sort out the issue and for payment to clear.

During the dunning period the gym is not notified of the failed charges.  As mentioned nearly all customers will sort the issue themselves before the 7 days is up (they do want to attend your gym after all!).  However if you would like to see a report of dunning memberships you can do so under Reports -> "Products - memberships" report and change the state to Dunning in the dropdown.

After 7 days of failures the membership is moved to the abandoned state and the gym is notified to take action.  See the abandoned membership section below for more details.


Current Exceptions:

Customer's who have a scheduled membership change from one membership type to another membership type or a scheduled change to add a new membership.

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In these cases, the above process does not stand. A failed payment will result in the scheduled change being cancelled and the account admin will be emailed about the failed payment and cancelled membership. There will not be an outstanding payment for this and needs to be resolved by the gym's staff.

We will be updating Wodboard to ensure that the same behaviour or recording a failed payment as an outstanding payment and enabling the scheduled membership to be applied.

Direct debits/ACH

When a payment is initiated we have no idea if it will succeed or fail (unlike cards which are instant).  As such you'll see a payment report a Pending state on the customer profile.

Pending state means that the payment request has been sent and we're awaiting a success or failed response.  How long this takes varies from 2-3 days (Australian direct debits) to about a week (UK direct debits).  We have no control over how long it takes for banks to respond on these and can only find out when they tell us.

Should a payment succeed the payment will be marked as so.  However should a payment fail then we move the membership straight to the abandoned state.  This is the main difference between Direct Debits/ACH and cards.  With cards we can afford to let the customer know and let them sort things out.  With direct debits and ACH it could be a couple of weeks later by the time you've tried charging them twice.  As such the membership is moved into the abandoned state after the first failure and you must decide on the best course of action.  See the next section for details.

Abandoned memberships

If we have been unsuccessful in taking a payment the membership will enter a state called Abandoned.  At this point the gym is notified of the failure, the customers existing bookings are cancelled and the customer can no longer book new classes.  In general customers don't like this at all which is exactly why we do it - it forces them to take action.

When you get the abandoned membership email you will have two choices - you can reattempt the charge again or you can cancel the membership.  Realistically given the membership charge has failed for a period of time you're going to have to talk to the customer first to discuss the issue. If the customer addresses the issue then it's a good time to reattempt the charge.  Assuming that reattempt is successful then the membership will move back to an active state and the customer will be able to book classes again. If it's not the membership will stay in the abandoned state.

Abandoned memberships can be seen from Reports -> "Products - memberships" report and changing the state in the dropdown. They are also highlighted on the dashboard via the abandoned number.  This is so you know how many are left to deal with.  Generally speaking it's a good idea to keep your admin in check and reactivate memberships after speaking to a customer if you can, and otherwise moving them to the cancelled state.  This then makes it really obvious on the dashboard when you have new abandoned memberships to chase.