In this guide 7 sections
Subscription billing needs more than invoices. The software raises a correct GST invoice for every cycle, collects through UPI AutoPay, a card or a bank mandate, and chases failed payments before service runs on unpaid. In India it must also follow the RBI rules on pre-debit notice and customer opt-out, which most businesses underestimate until the first complaint arrives.
Find Where Recurring Billing Breaks
A gym, a tiffin service, a software reseller and a firm selling maintenance contracts all bill monthly or quarterly, and most begin in Excel. Someone makes a Friday follow-up call. That works for the first customers.
It breaks when a plan changes mid-month, a customer pauses for a festival, or a card fails and nobody notices for six weeks. A customer who resumed after pausing should get a prorated first invoice and a fresh renewal date, otherwise the next cycle starts on a day nobody agreed.
A tiffin customer who paused for Dasara may still be billed, while an AMC that lapsed in March may keep receiving free visits until September. Both are ordinary cases. Both cost real money.
Collect Through a Mandate Under the RBI Rules
A mandate lets you charge the customer every cycle without asking them to pay again, and Razorpay, as one example, supports UPI AutoPay, cards and bank e-mandates for subscriptions.
The RBI’s E-mandate Framework, 2026, issued in April 2026, is described as covering recurring charges on cards, prepaid instruments and UPI, so check which instrument each customer pays with. Customers get a notice at least 24 hours before each debit, and they can opt out of a single debit or of the whole mandate.
Recurring charges up to ₹15,000 per transaction need no extra authentication step, while the limit is ₹1 lakh for insurance premiums, mutual fund subscriptions and credit card bill payments. These limits have moved before. Check the current RBI rules before you fix plan prices, and note the date you checked beside each limit in your pricing sheet.
Raise a Correct GST Invoice for Every Cycle
Each renewal is generally treated as a separate supply, and every one needs its own GST invoice with the right number series, rate and place of supply. An upgrade halfway through a cycle needs a clear invoice or a credit note for the prorated difference, never a backdated edit of the old one.
E-invoicing applies once aggregate turnover crosses ₹5 crore, the limit since August 2023, and each B2B renewal invoice then needs an IRN from the portal. At ₹10 crore or more, each e-invoice must also be reported on the portal within 30 days of its date, so build that reporting step into the renewal run. Confirm the current rules with your CA.
Keep invoice numbers in one place. If your billing app and Tally both issue numbers, you will have gaps and duplicates by the second quarter, and the auditor will ask why.
Plan for Failed Payments Before They Happen
Silence is the worst outcome. Many lapses are involuntary, caused by expired cards and low balances rather than a decision to leave, so the message after a failure should offer a payment link. An angry customer at least tells you something is wrong, whereas a lapsed mandate lets service run for months while nobody bills for it.
Write the failed-payment steps down before launch, in the order below, and give one named person the overdue list to open each morning.
- Retry an unsuccessful charge on a sensible schedule, not every hour
- Tell the customer on WhatsApp or email, with a link to pay another way
- Give the account a short grace period before service stops
- Pause access or deliveries automatically once the grace period ends
- Show the owner a daily list of failed and overdue accounts
Buy a Billing Tool or Build Around Your Process
Payment gateways and billing products already handle plans, mandates and retries well, and they have solved problems you may not have met yet. If your plans are fixed and simple, choose a ready product and connect it to Tally, so the ledger receives each invoice and receipt without retyping.
Custom work earns its cost when the bill depends on usage, visits or deliveries, or when prices are negotiated customer by customer. It also helps when a subscription must set something else in motion, such as a technician visit or a tiffin route sheet.
Often a gateway plus automation wins.
Subscription lifecycle and dunning plan
A diagram follows one subscription through trial, active, payment failed, grace period, paused and cancelled, with the invoice, the customer message and the owner alert shown at each step. A second table lists the RBI notice and opt-out checks alongside the GST invoice checks that must pass before every renewal goes out to the customer.
Open a blank worksheet to printQuestions owners ask
Can I auto-debit my customers through UPI every month?
Yes, through UPI AutoPay, once the customer approves a mandate in their UPI app, and they get a notice at least 24 hours before each debit. Charges above the RBI limit, ₹15,000 for most payments, need the customer to approve each debit with an extra authentication step.
What should happen when a subscription payment fails?
Retry a few times. Tell the customer with a link to pay another way, allow a short grace period, and then pause the service automatically. Every failed account belongs on a list that somebody opens daily, because an unread list is the same as no list.
Do I need a separate GST invoice for every renewal?
Generally yes. Each billing cycle is usually a separate supply and needs its own tax invoice, and if you fall under e-invoicing, B2B renewal invoices need an IRN as well. Confirm details with your CA.
Sources
- Reserve Bank of India: Digital Payments, E-mandate Framework, 2026 — verified 20 Sept 2026
- Razorpay Docs: Subscriptions — verified 20 Sept 2026
- GST Council: Notification 10/2023-Central Tax, e-invoicing above ₹5 crore from 1 August 2023 — verified 20 Sept 2026
- GSTN e-Invoice portal: Advisory on the 30-day reporting limit for AATO of ₹10 crore and above — verified 20 Sept 2026