Summary
You can usually rescue a failed Stripe payment on an invoice the same day. Read the reason in Stripe, tell the customer what happened in plain words, and send the pay link again with a second way to pay, such as ACH. Nothing was paid, so the invoice stays open in Xero or QuickBooks until a payment succeeds.
- Why it failed: The card issuer or bank declined it, Stripe's fraud checks blocked it, or a bank debit was returned days later.
- What to tell the customer: The amount, that the payment did not go through, the reason if it helps them, and the link to try again.
- Do not: Do not retry a card yourself without asking, and do not charge a fee unless your terms allow it.
Stripe emails you: a payment on an invoice has failed. The customer probably thinks they paid, because they clicked the button and entered their card. The invoice is still open in your ledger, and the customer has no idea anything went wrong.
Here is why Stripe payments fail, what each status means, what to do for each reason, what to tell the customer, and what happens to the invoice.
Free: Payment reminder email templatesCopy the reminder emails for before, on and after the due date.Why do Stripe payments fail?
Stripe payments fail for three reasons, according to Stripe's guide to declines: the card issuer or bank declined the payment, Stripe's fraud screening (Radar) blocked it, or the payment request itself was invalid. On invoices paid by customers, the first two cover almost every case.
Issuer declines come with a code. The ones you will see most often on business invoices:
- Insufficient funds. The card or account does not have the money right now.
- Expired card or wrong card details. An old card on file, or a typo in the number or security code.
- Generic decline. The issuer said no without a reason. Common on company cards with spending limits.
- Authentication required. The bank wanted the customer to confirm the payment, for example in their banking app, and they did not.
Bank debits such as ACH fail differently. They do not fail at checkout. Stripe says an ACH Direct Debit can take up to 4 business days to confirm, and it can fail during that time for insufficient funds, an invalid account number or a customer blocking debits.
Failed, action required or pending: what each status means
A payment that has not succeeded is not always a failure. The status tells you whether to act now, wait, or chase the customer:
| Status | What it means | What you do |
|---|---|---|
| Failed | The card issuer or bank declined it, or a bank debit was returned. No money moved. | Tell the customer and send the link again. |
| Action required | The payment is waiting on the customer, for example to confirm with their bank or verify a bank account. | Remind the customer to finish that step. |
| Pending | A bank debit is in progress and has not cleared. | Wait. Hold reminders on that invoice until it clears or fails. |
| Abandoned or expired | The customer opened the pay screen and left before paying. | Follow up with the same link the same day. |
Abandoned payments need a different message from failed ones. See how to follow up on abandoned payment links.
What to do, by failure reason
| Reason | What to do next |
|---|---|
| Insufficient funds | Ask the customer when the money will be there, or offer to split the payment. Do not retry the card the same day. |
| Expired card or wrong details | Send the link again so the customer can enter the right card. |
| Generic decline | Ask the customer to call their card issuer, or pay by ACH instead. You cannot fix this on your side. |
| Authentication not completed | Send the link again and ask them to keep their banking app open to approve it. |
| Blocked by fraud screening | Check the payment in Stripe. If you know the customer and the payment is real, Stripe lets you allow it for future payments, then send the link again. |
| Bank debit returned | Treat it as a failed direct debit: read the return reason and contact the customer. See failed direct debit: what to do next. |
What to tell the customer
Tell the customer the same day, in plain words. Many will not notice the failure until your next reminder, and by then they believe they already paid.
Hi [first name], your payment of [amount] for invoice [number] did not go through. [Your card issuer declined it / Your bank asked you to confirm it and it timed out.] Here is the link to try again: [pay link]. You can also pay by bank debit on the same page. Thanks, [your name]
Keep the reason short. "Your bank declined it" is enough. Customers do not need Stripe's decline code, and a vague reason is better than a wrong one.
What happens to the invoice?
Nothing was paid, so the invoice stays open in Xero or QuickBooks, and your reminder schedule carries on as before. That is usually right for a card that failed, as long as the customer has heard from you first.
Bank debits are different. In Paidnice, a failed direct debit, including a failed ACH payment, freezes the invoice until you fix it, so no reminder or automatic late fee goes out on top of the failure.
One mistake we have seen in support is counting a bank debit as paid when it starts. A customer's ACH payment was slow to clear, they paid again another way, and the invoice ended up paid twice.
Count a bank debit as paid when it clears. The fix for a double payment is in customer says they paid, but the invoice is still unpaid.
Can you charge a fee for a failed payment?
Only if your terms of sale allow it. Stripe can charge you a fee for some failed bank debits and for disputes, but that does not by itself give you the right to pass it on. If your terms do not mention it, absorb it the first time and add a clause for the future.
Late fees are a separate question. If the invoice is overdue, your usual late fee policy applies whether or not a payment attempt failed.
How Paidnice handles a failed Stripe payment
Customers pay your invoices through Stripe on the Paidnice customer payment portal, by card or bank debit, without leaving the portal. Payments that succeed are recorded against the invoice in Xero or QuickBooks.
- Payments page. Every payment attempt is listed with its status: failed, action required, pending bank debit, abandoned or expired checkout, and paid but sync failed. You see a failed payment without opening Stripe.
- Card or bank debit. The portal offers card and direct debit, including ACH, so a customer whose card was declined can switch on the same page.
- Send the link again. From the invoice, send a reminder or an SMS with the pay link straight away.
- Replies in one place. The customer's answer lands in the shared inbox, where your team can assign it and add notes.
If the customer does not come back, your email and SMS reminders carry on with the pay link in each one. The Payments page is on every plan.
💡 Paidnice insight
When a card fails on a large invoice, offer ACH in the same message. Company cards often have spending limits that a bank debit does not.
Frequently asked questions
Does Stripe retry a failed invoice payment automatically?
Stripe can retry failed payments on invoices it issues itself through Stripe Billing, if you turn retries on. For a payment the customer makes from a pay link, do not count on a retry: send the link again and ask the customer to pay.
Why does a payment say action required?
The payment is waiting on the customer. Usually their bank wants them to confirm the payment, or a bank account needs verifying before it can be debited. Remind them to finish that step.
Can I retry the customer's card myself?
Only with the customer's permission. Retrying a declined card without asking usually leads to another decline. Send the link and let the customer choose how to pay.
How long does a failed ACH payment take to show up?
Up to 4 business days, according to Stripe. An ACH payment can also be returned after it first shows as successful, which Stripe then reports as a dispute.
Does a failed payment mean the customer will not pay?
Not usually. A failed payment means the customer tried to pay and something stopped it. Contact them the same day while they still have the invoice in mind.
Paidnice features in this article
- Customer payment portal Shows customers every open invoice in one place, where they can pay.
- Direct debit Lets customers pay by direct debit through Stripe: ACH, Bacs, SEPA, BECS, NZ bank debit and Canadian PAD.
- Email and SMS reminders Sends reminders by email and SMS on your schedule, each with a link to pay.
About the editorial team
Ashley is a co-founder and lead developer of Paidnice and has built accounting software for more than 10 years. He builds the ledger connections that put reminders, late fees and payments into Xero, QuickBooks and ERPs such as NetSuite and Business Central. Before Paidnice he co-founded A2X, ecommerce accounting software for Xero and QuickBooks.
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