Decline Classifications, Smart Retries & Dunning

Fype manages payment recovery automatically using a rules-based dunning engine to handle transaction declines and retry failed charges.

Decline Classifications

Fype separates payment failure codes received from gateway networks (Razorpay and Cashfree) into two distinct categories:

Soft Declines (Recoverable):
- Causes: insufficient_funds, bank_timeout, network_error, temporary_decline.
- Handling: Bypasses immediate cancellation. The subscription status changes to past_due, and Fype schedules a smart retry campaign.
Hard Declines (Unrecoverable):
- Causes: expired_card, cancelled_mandate, invalid_account, mandate_revoked.
- Handling: Bypasses the retry loop entirely. The subscription transitions to cancelled immediately and alerts the merchant via a subscription.cancelled webhook.

Smart Retry Scheduling Rules

To maximize transaction authorization rates, Fype schedules retry attempts for soft declines using the following optimizations:

                  SOFT DECLINE DETECTED
                            │
               Is retry scheduled on Sunday?
              /                             \
            YES                              NO
            /                                 \
   Reschedule to Monday                        │
            │                                  │
            └───────────────┬──────────────────┘
                            │
              Does retry fall in nightly window?
              (11:00 PM - 3:00 AM IST)
              /                             \
            YES                              NO
            /                                 \
   Reschedule to 8:00 AM                       │
            │                                  │
            └───────────────┬──────────────────┘
                            │
               Is fail date late in month?
               (On or after the 28th)
              /                             \
            YES                              NO
            /                                 \
   Reschedule to 1st of                        │
   next month at 10:00 AM                      │
            │                                  │
            └───────────────┬──────────────────┘
                            │
                     Execute Charge

1. The Sunday Check

Fype automatically shifts retry attempts scheduled for a Sunday to Monday morning. Transaction success rates are historically lower on Sundays due to decreased bank processing speeds and low settlement activity.

2. Nightly Bank Maintenance Blackouts

Many Indian banks execute system maintenance windows late at night, resulting in high failure rates. Fype blocks retry attempts scheduled between 11:00 PM and 3:00 AM IST and reschedules them to run at 8:00 AM IST the following morning.

3. Salary Credit Optimization

For transactions that fail on or after the 28th of the month, Fype schedules the retry to occur on the 1st of the next month at 10:00 AM IST. This aligns retry attempts with salary credits to maximize success.

Dunning & Notification Schedule

While Fype is retrying charges in the background, it runs a configurable customer notification campaign:

Attempt	Reschedule CADENCE	Customer Notification Action
Initial Failure	-	Email / SMS notification of payment failure; card update link provided.
Retry #1	+ 2 Days	Payment failed notification; subscription marked as `past_due`.
Retry #2	+ 5 Days	High-priority SMS / WhatsApp alert.
Retry #3	+ 10 Days	Final warning.
Failure Limit	+ 15 Days	Max retries met. Subscription moves to `halted` (or `cancelled`).

fype Documentation

Dunning retries

Decline Classifications, Smart Retries & Dunning