How do recurring payments work?

Recurring payments, also known as AutoPay, allows you to automatically charge a client's credit card, bank transfer (ACH) details, Direct Debit Mandate, or PayPal account on a regular basis through a recurring template invoice or a retainer. Payment is taken automatically, making recurring payments ideal for subscriptions or other recurring services.

Recurring payments applies to the following:

• AutoPay - Allows your clients to opt in to be charged automatically on invoices generated by recurring templates, included in all FreshBooks plans at no extra cost
• AutoCollect - As part of Advanced Payments, require clients to opt into AutoPay, and add clients’ saved credit cards to a recurring template

AutoPay and AutoCollect are card-on-file payment types that keep saved cards secure and current, payments retrying automatically, and your billing running without interruption. 

• Activate Recurring Payments
• Deactivate Recurring Payments
• FAQs

Activate Recurring Payments

To activate recurring payments, follow these steps:

1. If using Direct Debit, collect the payment information with a BACS or SEPA Mandate first
2. Set up a recurring template or retainer
3. Activate one of the online payment options on the recurring template or retainer
4. Send the recurring template or retainer to your client. The primary client will automatically receive a payment notification email after any future generated invoices are automatically paid.

As long as your recurring template or retainer shows Accept Online Payments set to Yes and there is a recurring schedule, or the retainer is active, recurring payments are always available to you and your clients: 

• AutoPay - For details on how a client can opt into recurring payments and edit their details, review As a client, how do I pay my invoices automatically?
• AutoCollect - For details on how you can require AutoPay or add a saved card to a recurring template for recurring payments, review What are Advanced Payments?

Deactivate Recurring Payments

If you no longer want the recurring template or retainer to charge your client automatically after they've opted into recurring payments with AutoPay, you can deactivate this with the below steps: 

1. Select the Invoices section
   1. For recurring templates, select the Recurring Templates sub-section
      1. Find the recurring template that is set to card saved or account saved, and select it
   2. For retainers, select the Retainers sub-section
      1. Find the retainer that is set to card saved or account saved, and select it
2. Select the Edit button
3. Under Settings, select Accept Online Payments
4. Hover over the saved payment information and select the trash can icon to delete it - the recurring template or retainer will stop recurring payments immediately
   
5.  If you'd like to turn off online payments entirely, slide the toggle off
   
6. Select Done to apply the payment settings
7. Then select Save to finish. The recurring template or retainer will continue to generate invoices if there are any remaining or it's set to infinite. Your client will need to re-opt again with AutoPay or pay each generated invoice individually. If online payments have been turned off, your client will not be able to pay through online payments.

FAQs

What happens if a recurring payment fails?

When a recurring payment fails, an email is sent to the primary client first. Next, it will go into Retry status automatically, where the payment will be attempted again on the original saved payment in the next 24 hours. If it fails after the first retry, it will retry again for a second time. Upon the second failed retry, the invoice will be updated with a Declined status and will stop retrying automatically.

To manually retry a declined invoice, select the declined invoice, then select the Retry Payment link at the top of the invoice in the history bar.

The invoice will retry again in the next 24 hours. This can be repeated every 24 hours as often as needed. You can also ask your client to update their payment information, which will automatically force the recurring payment to retry on the new payment instead. 

Can I edit a recurring template that has an active recurring payment on it? 

If the recurring payment is through a:

• Credit Card or PayPal Account - The recurring template can be edited fully with no disruption to the saved credit card or PayPal account information
• Bank Account (Bank Transfer (ACH) and Direct Debit) - Modifying the invoice's Amount Due or the frequency in the Recurring Schedule's Number of Invoices field will cause the saved bank transfer recurring payment to be removed. The client will then need to re-opt into recurring payments on the next generated invoice to save their information again.

What happens if my client's saved credit card has changed?

Credit card information can change regularly with expirations, fraud detection, loss, and upgrades. It's recommended to have your clients update their credit card information as soon as possible to ensure no disruptions to their recurring payments. As a backup, FreshBooks utilizes network card updater technology to retrieve any updated credit card information from the card issuer. This can help minimize disruptions in recurring payments until your client can update their saved information.

What’s the difference between AutoPay and AutoCollect?

AutoPay and AutoCollect both automate recurring payment collection, but differ depending on who initiates the process:

• AutoPay - Clients can opt into automatic payment by saving their own card and consenting to automatic future charges when paying their first recurring invoice
• AutoCollect - AutoCollect is included in the Advanced Payments add-on and as the business owner, you can either:
  • Require your clients to opt into AutoPay on a recurring template
  • Save your client’s card directly to their client profile and/or on a recurring template to collect payments automatically