Stripe Subscriptions for SaaS: Setting Up Recurring Payments

Recurring payments are the backbone of monetisation for SaaS, online courses, membership communities and any subscription-based service. Stripe Billing provides ready-made infrastructure — from plan creation to automated dunning when a charge fails.

Core Stripe Billing concepts

Product — what you're selling (e.g. "Pro Plan").

Price — how much and how often to charge (e.g. $29/month or $290/year).

Customer — a Stripe customer object that subscriptions and payment methods are attached to.

Subscription — an active customer subscription that automatically generates an Invoice at the start of each billing period.

Creating a product and price via API

// Create a product
$product = \Stripe\Product::create([
    'name' => 'Pro Plan',
]);

// Create a monthly price
$price = \Stripe\Price::create([
    'product'    => $product->id,
    'unit_amount' => 2900, // $29.00 in cents
    'currency'   => 'usd',
    'recurring'  => ['interval' => 'month'],
]);

Trial periods and freemium

Add trial_period_days when creating a subscription to give customers time to evaluate the product. Stripe doesn't charge during the trial and automatically transitions the subscription to active status when it ends.

$subscription = \Stripe\Subscription::create([
    'customer' => $customerId,
    'items'    => [['price' => $priceId]],
    'trial_period_days' => 14,
]);

Managing the subscription lifecycle

• Upgrade/Downgrade — change the plan via Subscription::update() with proration_behavior
• Pause — suspend without cancelling (useful for customers with temporary financial difficulty)
• Cancel at period end — cancels at the end of the paid period; customer retains access until then
• Immediate cancel — instant cancellation with optional refund

Dunning — automated payment recovery

When a customer's card is outdated or declined, Stripe Smart Retries automatically retries at the optimal time. Configure an email notification sequence in Billing → Subscriptions → Smart Retries in the Dashboard.

SaaS metrics via Stripe

Stripe automatically calculates key metrics:

• MRR (Monthly Recurring Revenue)
• Churn rate
• Net revenue retention
• Active subscribers

These are available in Revenue Recognition and via API for export to BI systems.

Common subscription setup mistakes

• No Customer Portal configured — customers can't update their card or cancel on their own
• Missing invoice.payment_failed handler — customers continue using the service without paying
• Incorrect proration calculation when switching plans

If you need help configuring Stripe Billing for your SaaS model — we'll set up the right configuration and provide an account with transaction history.