Claims Management: How to Recover Failed Payments?

Reduce the loss of money and increase your Recurring Monthly Income by managing the recovery of failed payments through different strategies.

Keeping customers informed about your service billing and account status, and tracking payment problems has multiple benefits.

What is Claims Management?

Claims Management is the set of processes that are carried out to recover failed payments from clients.

Inevitably, and even though users are willing to make their payments, problems may arise when making them, such as the expiration of the credit card, incorrect billing information, or insufficient balances. These situations are very common in companies that base their business model on subscription contracts.

Claims Management for SaaS

Why is it so important?

SaaS industries use management software that facilitates communication with users who are without payments recorded to avoid losing Monthly Recurring Revenue (MRR).


Losses due to non-payment are estimated to be around 9% of the MRR. Without a management system, that percentage increases.

Do customers always know about payment failures? The answer is no; therefore, it is important to contact them to notify them of your current account status.

The most frequent errors are those that have to do with the renewal of the cards and with the users who forget to update their data in the means of the payment form. This usually happens, especially when they don’t log into your product frequently.

Service interruptions

With Claims Management, service interruptions for customers are avoided. Imagine being left without electricity service for falling behind in payment and without prior notice: the frustration and anger would be directed directly to the company. Well, the same is true in SaaS industries.

Customer Experience

Avoiding service interruptions also improves the customer experience and the company’s relationship with it. In most cases, payment failures do not occur due to dissatisfaction with the service. For this reason, sending reminders avoids many problems for users and also helps to gain their trust for long-term contracts.

Processes in Claims Management

Payment Failure

The trigger for activating Claims Management is a payment problem. From there, whatever the reason for the failure, the contact and recovery process will begin.


The first contact is made through a notification email. Be sure to include a link to update your payment information and troubleshoot. At this point, it is convenient to have a well-defined text of the e-mail that, in most cases, is written by a copywriter or a UX writer.

Sometimes, it usually happens that the payment does not enter for exceeding the limits of the credit card; this is solved after the client makes the corresponding payment. Therefore, in this case, it is not necessary to modify the card details but to give the option to try again.

Some companies implement automated payment retry software to find quick solutions in these specific situations.

Update payment information

If the client has seen the first email, they will access the payment information and may modify the data to do so. If this happens, the Claims Management is already resolved. On the other hand, if the user has ignored the first e-mail, the process should continue and follow up.


Do not rely only on the first email: it may happen that the customer has overlooked it or that they have forgotten to log in to update the data. It is necessary to resort to a second email to increase the display possibilities.

With the same friendly tone as the first, the reminder is resent with the buttons or links to access the solution to the problem. But when to send it?

It is not convenient to tire the user with mass emails: it is preferable to try to leave a space of time between one email and the other. For example, 5-6 emails can be sent in 30 days. Also, you can specify in the body of the message how many days the customer has for the regularization of the payment.

Placing a notification in the app also works. If the customer is busy using your service, they are more likely to see the information there rather than in their mailbox.


After the attempts by mail and through the payment notifications in the App, the service for that client will be canceled. If you need the services, you would have taken care of resolving the non-payment on any of the claim notices.

Claims Management Software

Doing all of this one case at a time would be chaotic and lead to the loss of your chances of recovering multiple payments. For this reason, there is management software that helps optimize monitoring tasks.

Pabbly – Email Marketing Software

Using the Pabbly management tool, you can record monthly and yearly income very easily, and also automate tracking for failed payments.

As a first step, it keeps customers informed about their billing, which works as a constant reminder. Then, send claim e-mails in case of failed payments and give information about grace periods so that you can pay off the debt and not lose service.

As the main features for SaaS companies, it offers a customer portal and allows you to store all invoices in one place, place the logo of each business and perform free trials.

What distinguishes it from other platforms is that it does not charge any transaction percentage and, also, it provides statistics and payment facilities.


Like Pabbly, FastSpring offers follow-up automation with renewal reminders and payment alerts to customers.

The good thing about this tool is that it maintains flexible plan management since, besides the free trial, it offers monthly and annual plans.


With Baremetrics, claims can be tracked through emails and notifications, but with the advantage of including an analysis of the revenue made through these claims.

In addition to a free trial, it offers personalized pricing for each stage of the business.

Zoho Subscriptions

Managing your claims through Zoho Subscriptions is very easy. This platform offers automation systems for tracking failed payments and metered billing that allows customers to be charged according to their use.

How to write a payment claim E-mail?

Wouldn’t it be ideal to resolve payment claims with the first e-mail? To have the best chance of success, we must implement strategies to ensure that the email reaches the user’s inbox and that the subject is reliable and convincing to improve the open rate. Also, applying small optimization tweaks make a big difference to your MRR.


For the email subject to be effective, you need copywriting skills that involve appealing to clients’ emotions. For example, pointing to the need to solve something at the moment or to feel lacking.

It is very important to include the name of the brand. At first glance, it must be possible to identify the issuer of the communication to give additional confidence and not be marked as Spam. In this way, the customer will easily recognize it.

As a second instance, the subject must contain the main cause of contact. For example: “Payment declined from your account X (brand name). ” If this is not stated in the subject line, the email could be taken as promotions or suggestions, and it would not demand any urgency to be opened.

Body of the e-mail

A well-written subject that encourages open mail is of no use if the information in the body of the e-mail is scant or not understood. It is necessary to be clear and concise: indicate what happened and how it can be resolved.

The problem is that, if we apply these concepts very coldly, the client can feel offended; therefore, the writing must be friendly and empathetic. One way to achieve this and to avoid alarming the user is by giving them examples of causes why the payment may have failed or simply guiding them to solve the problem with links or direct buttons to the payments section of the App.


As it is not possible to assume that the only reason for the payment failure was a change in the billing information, the closure of the mail can be used to provide other options for customer support.

Good practices for Claims Management


To make sure you increase your MRR, the best option is to automate claims through management software. It does not matter how many clients you have: even if they are few, you will not be able to be behind each one of them every time they have to renew their subscription or do not make a payment. There is no point wasting so much valuable time when very agile tools exist to solve these problems.

Facilitates the renewal of payment information

It tries to facilitate the renewal of payment information so that in two clicks the customer can solve the problem, either through a button or link by email or through a notification in the App. The easier the way for customers is, the easier it will be to be able to receive payments.

Use templates in your emails

The use of templates in emails speeds up the task, saves a lot of time, and provides immediate access to a wide audience.

Also, in cases as general as updating payment details, it is convenient to create a single e-mail to be used in management. Using different types of emails for the same topic can lead to mistrust if they are sent multiple times to the same customer.


To stop losing income due to payment failures, it is essential to have Claims Management. This method also allows you to improve communication and relationships with your customers, keeping them informed about their billing situation.

Do you use any of the mentioned tools? Tell us about your experience in Claims Management automation.

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Ahmed Ismail

I'm a Civil Engineer. I like reading everything related to Business so I decided to launch the "Fast Grow Company" website to help Entrepreneurs in their business journey. Keep updated and follow us.

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