Getting paid every cycle, without chasing anyone
Subscription payments · recurring guide
A subscription is a promise to charge the same customer again and again. In India that promise sits on a mandate, and RBI's rules decide how the customer is told, when they must authenticate and how they can stop it. This guide covers setting it up, the rules every renewal follows, and what to do when one fails.
A monthly plan, cycle by cycle
Illustrative- At least 24 h before: the customer's bank or card issuer notifies them
- Charge day: the recurring debit is processed
- After: post-debit notice from the issuer, your receipt
- Quiet period until the next cycle
- Cycle 1Card mandate set up with the first payment, authenticated once
- Cycle 2Notice sent, charged, receipt emailed
- Cycle 3Charge failed: insufficient funds. Customer emailed; retried two days later and paid
- Cycle 4Card reissued by the bank; mandate carried over. Charged
Three ways to charge a customer again
Recurring payments in India run on three rails. The customer experience of setting each one up is different, and so are the rules afterwards. Choose one to see how it works.
The customer saves their card for recurring charges and authenticates once with their card issuer.
- 1The customer chooses a plan and pays the first charge by card.
- 2They agree to recurring charges and authenticate with their issuer; the first payment and the registration can share one authentication.
- 3The card is saved as a token with the provider, and the mandate is registered with the issuer.
- 4Each cycle, the issuer notifies the customer at least 24 hours ahead, then the charge runs.
Fits: Card-first customers, international cards on some setups, SaaS and media.
The customer approves a mandate in their UPI app, with their UPI PIN.
- 1The customer chooses UPI at checkout and gets a mandate request in their UPI app.
- 2They review the merchant, amount and frequency, and approve with their UPI PIN.
- 3The mandate appears in their UPI app, where they can manage or revoke it.
- 4Each cycle, they're notified at least 24 hours ahead, then the debit runs from their bank account.
Fits: Smaller monthly amounts; customers who pay everything by UPI.
A bank-account mandate, approved through the customer's bank online (eNACH) or on paper.
- 1The customer gives their bank account details and approves the mandate with their bank.
- 2Once the mandate is active, you present each debit under it.
- 3The customer's bank honours or returns each debit; you learn the result after the NACH cycle.
- 4NACH follows NPCI's rules rather than RBI's e-mandate framework for cards and UPI.
Fits: Larger amounts: EMIs, premiums, B2B subscriptions.
NACH in depth: the NACH guide. How saved cards work: card tokenisation.
Setting up: the first payment carries the most weight
Under RBI's e-mandate framework for cards, UPI and prepaid instruments, a mandate is registered only after the customer passes an additional factor of authentication with their issuer. The first charge needs it too, but when the first charge happens together with registration, the two can share one authentication. That's why most subscriptions start with a paid first cycle, or a small payment, rather than a silent sign-up.
Two decisions at setup shape every renewal after it: whether the mandate is for a fixed amount or a variable one, and how long it lasts. Every mandate carries a validity period, and for variable mandates the customer can set the maximum value of any single charge.
Fixed amount
The same charge every cycle. Simple to explain; a price change needs the mandate changed.
Variable amount
Usage-based or changing bills, up to a maximum. Set the maximum with headroom, because a charge above it will fail, and any change to the mandate needs the customer to authenticate again.
What happens around every renewal
For card, UPI and prepaid-instrument mandates, the issuer, not you, sends two notices to the customer on every cycle. They set the rhythm your billing has to fit.
Before: at least 24 hours
The issuer notifies the customer with the merchant's name, the amount, the date and time of the debit, the mandate reference and the reason. The customer chooses how to receive it, and can opt out of that charge.
The charge
Up to ₹15,000, the charge runs without the customer authenticating. Above that, the customer has to authenticate the charge.
After: a post-debit notice
The issuer confirms the merchant, amount, date and time, the transaction and mandate references, and how to raise a complaint.
What this means for you: charge on the date and for the amount the notice said, or the customer sees a mismatch. And since the customer can opt out of any single charge, build for that outcome instead of treating it as rare.
The ₹15,000 line, and why annual plans feel different
RBI's framework lets recurring charges go through without extra authentication up to ₹15,000 per transaction. For insurance premiums, mutual fund subscriptions and credit card bill payments the figure is ₹1 lakh. Above those amounts every charge needs the customer to authenticate.
For a monthly plan this rarely matters. For an annual plan priced above ₹15,000, it means the renewal isn't automatic: the customer has to be reachable and willing on the day. Plan the reminder and the payment flow for that renewal as carefully as the first sale.
| Charge | Without extra authentication |
|---|---|
| Most recurring charges | Up to ₹15,000 per transaction |
| Insurance premiums, mutual fund subscriptions, credit card bills | Up to ₹1,00,000 per transaction |
| Anything above those amounts | Customer authenticates each charge |
| First charge, any amount | Authenticated (can share registration's authentication) |
From RBI's Digital Payments – E-mandate Framework, 2026. Applies to recurring transactions using cards, prepaid instruments and UPI.
When a renewal fails
A failed renewal is usually not a customer leaving. It's a card that was replaced, a low balance on the day, or a notice they didn't read. Losing customers this way is called involuntary churn, and a clear recovery routine, often called dunning, wins many of them back.
- Day 0Charge failsRead the reason. Email or message the customer the same day with what happened and a link to pay or update their method.
- A few days laterRetryRetry when funds are more likely, such as just after a typical salary date. Don't retry repeatedly on the same day.
- Grace periodKeep accessLet the customer keep using the service for a short, stated period while you try to recover the payment.
- End of gracePause, don't deletePause or downgrade the account, and keep their data, so paying later brings everything back.
- After thatClose cleanlyCancel the subscription on your side and tell them. Don't keep presenting charges on a mandate they've stopped paying through.
A recovery routine is your policy, not a rule. How retries are scheduled on Peneu is confirmed during onboarding; see also smart retry.
Upgrades, downgrades and pauses
| Change | Billing | Mandate |
|---|---|---|
| Upgrade mid-cycle | Charge the difference now (prorated) or from the next cycle | Fine if the new amount fits the mandate; otherwise the mandate must be changed, with authentication |
| Downgrade | Usually from the next cycle, sometimes with a credit | No change needed |
| Pause | No charges while paused | Keep the mandate; skip presenting charges |
| Price increase | Announce it well ahead | A fixed-amount mandate needs changing; a variable one needs the new price under its maximum |
| Switch from monthly to annual | One larger charge | Check it against the ₹15,000 line and the mandate's maximum |
Cancellations and refunds
Customers can withdraw a card, UPI or prepaid-instrument mandate through their issuer at any time. If your own cancel button is hard to find, they will, and you'll learn about it from a failed charge instead of a conversation.
When someone cancels, stop presenting charges at once, confirm it in writing, and say what happens to their access and data. Refunds for an unused period follow your published policy; the mechanics are in the refunds guide. The customer pays nothing for the e-mandate facility itself: RBI's framework says no charges are levied on them for it.
Measuring recurring revenue honestly
- Voluntary churn
- Customers who chose to cancel.
- Involuntary churn
- Customers lost to failed payments they didn't intend.
- Recovery rate
- Failed renewals later paid, as a share of all failed renewals.
- Renewal success
- Renewals paid on the first attempt, as a share of all renewals due.
Free trials that turn into paid plans
A free trial with no payment details converts poorly, because the customer has to come back and set up payment at the end. A trial that sets up the mandate at sign-up converts better, but it has to be honest: the customer should know exactly when the first charge happens and how much it is.
Since the mandate has to be registered with authentication, many businesses set it up at sign-up with a small first payment, or a charge that's refunded, so the registration and the first transaction share one authentication. Whatever you do, the first real charge still gets the issuer's notice at least 24 hours before, so the customer will see it coming, and you should tell them too.
Sign-up
Plan, trial length and first charge date shown before the customer authenticates.
A few days before the trial ends
Your own reminder: what they'll be charged, when, and how to cancel.
At least 24 hours before
The issuer's pre-debit notice.
First charge
Receipt, and the date of the next one.
Every cycle needs its own paper trail
A subscription is many small sales, not one. Each charge should produce its own receipt, and, if you issue tax invoices, its own invoice, with the period it covers. Customers claiming expenses need them, and so does your own reconciliation.
Make the amount on the receipt match the amount on the issuer's notice and on the customer's statement, including any tax. If the mandate amount is tax-inclusive, say so at sign-up; a customer who agreed to “₹499 a month” and sees a different figure on their statement will call. What your invoices must contain is a tax question for your adviser.
- Period
- 1–31 October
- Plan
- Pro, monthly
- Charged
- ₹499.00 on 1 Oct, card ending 4821
- Mandate
- Reference shown on the issuer's notice
- Next charge
- 1 November, ₹499.00
- Manage or cancel
- Link to their account
Illustrative receipt lines.
Subscribers abroad, and subscriptions to services abroad
RBI's e-mandate framework applies to recurring transactions using cards, prepaid instruments and UPI, whether domestic or cross-border. For an Indian customer paying a subscription with an Indian card, the same rules apply: authentication at registration, the issuer's notice before each charge, the limits, and the right to withdraw.
Customers paying you with cards issued abroad are governed by their own country's rules and their issuer's practices, which may be quite different. If you bill customers in several countries, expect renewal behaviour to differ between them, and read the international payments guide for how cross-border collection works.
The renewal questions your support team will get
| Customer says | Usually means | Answer with |
|---|---|---|
| “I was charged without warning” | They didn't see the issuer's notice or your reminder | The charge date, the notice they should have received, and how to cancel |
| “I cancelled but was still charged” | They cancelled in one place but not the other, or after the notice went out | Check when and where they cancelled; refund if the charge came after |
| “My renewal failed but my card works” | A limit, a replaced card, or a mandate withdrawn at their bank | The failure reason, and a link to pay or set up the mandate again |
| “Why was I charged a different amount?” | A plan change, proration or price change on a variable mandate | The breakdown, and when the change was announced |
Who bills on a cycle
| Business | Usual method | What matters most |
|---|---|---|
| SaaS | Card e-mandate | Seat changes and proration; annual plans over ₹15,000 |
| Media and streaming | UPI AutoPay or card | Low amounts, many customers; recovery of failed renewals |
| D2C replenishment | UPI AutoPay or card | Variable amounts; clear notice before each charge |
| Education and coaching | UPI AutoPay or NACH | Fee schedules, pauses between terms |
| Insurance | NACH or card | The ₹1 lakh category limit; policy-term end dates |
A subscription is a state machine
Billing bugs usually come from a subscription that can be in two states at once, for example cancelled in your app but still being charged, or paid but still locked out. Give every subscription exactly one state, and let only payment results and customer actions move it.
Treat notifications of payment results as prompts to check the result, not as the result itself, and make handling them safe to repeat. A duplicated “payment succeeded” message should never extend a subscription twice.
| State | Moves to | When |
|---|---|---|
| Trialing | Active or cancelled | First charge succeeds, or the customer cancels |
| Active | Past due or cancelled | A renewal fails, or the customer cancels |
| Past due | Active, paused or cancelled | Recovery succeeds, grace ends, or the customer cancels |
| Paused | Active or cancelled | The customer resumes, or the pause ends in cancellation |
| Cancelled | Nothing | Stop presenting charges; keep the history |
Illustrative states for your own system; not Peneu status names.
Recurring payment questions
Do recurring payments need a notice for every single charge?
For card, UPI and prepaid-instrument mandates, yes: RBI's framework requires the issuer to notify the customer at least 24 hours before each debit, with a few listed exceptions such as auto-replenishing FASTag and National Common Mobility Card balances.
Can a customer set a maximum on what I charge them?
Yes. For variable-amount mandates, RBI's framework requires the issuer to let the customer set the maximum value of any recurring charge. A charge above it won't go through without the customer's authentication.
Can I change a customer's billing date?
Usually yes, as a billing decision on your side, often with a prorated charge or credit for the change. The customer should be told, and the issuer's pre-debit notice will reflect the new date.
Should I offer both UPI AutoPay and cards?
Offering both lets customers use what they already trust. UPI suits smaller monthly amounts for customers who pay everything by UPI; cards suit card-first customers and some international customers. Each renewal still follows the rules for the method the customer chose.
Who sends the notification before a subscription is charged?
For card, UPI and prepaid-instrument mandates, the customer's bank or card issuer sends it, at least 24 hours before the debit, under RBI's e-mandate framework. It names the merchant, the amount, the date and time, and the mandate reference. Many businesses also send their own reminder.
Can I charge more than ₹15,000 on a recurring mandate?
Yes, but above ₹15,000 per transaction the customer has to authenticate that charge, so it isn't automatic. For insurance premiums, mutual fund subscriptions and credit card bill payments the limit without extra authentication is ₹1 lakh per transaction.
What happens if a customer opts out of one renewal?
The issuer lets customers opt out of a particular transaction, or the whole mandate, with authentication. Your charge will then fail. Treat it like any failed renewal: tell the customer what it means for their access, and offer a way to pay or pause.
Why do renewals fail?
Mostly for reasons outside your control: not enough money on the day, a card that was replaced or expired, a mandate the customer withdrew, or a limit. A retry a few days later, with a reminder to the customer, recovers many of them.
Can a customer cancel their mandate without asking me?
Yes. Issuers must let customers modify or withdraw a mandate at any time. Make cancelling easy on your side too: it avoids disputes and it's what customers expect.
Is there a charge to the customer for setting up an e-mandate?
No. RBI's framework says no charges are levied on the customer for using the e-mandate facility for recurring transactions.
What happens when a customer's card is replaced?
RBI's framework allows existing e-mandates to be mapped to a reissued card, so a renewal may continue on the new card. If it doesn't, the charge fails and the customer needs to set up the mandate again.
Which recurring methods does Peneu support?
Which mandate types (card, UPI, NACH) are available, and through which providers, is confirmed during onboarding. Recurring charges have to stay with the provider that holds the mandate or card token.
Official sources
- RBI — Digital Payments – E-mandate Framework, 2026 (21 Apr 2026)Registration with authentication, validity, fixed/variable mandates, 24-hour pre-debit and post-debit notices, ₹15,000 and ₹1 lakh limits, no charge to customers, reissued cards.
Last reviewed . Examples, amounts and screens marked illustrative are not Peneu figures.