Failed Direct Debit recovery for gyms with GoCardless

Every month some members' Direct Debits fail, and the front desk chases them between inductions and phone calls. If 12 of 300 payments fail in a month (4%, an assumption) and each takes 10 minutes to chase, that's 120 minutes, 2 hours. If 3 of the 12 are never collected at £35 each, that's £105 lost.

GoCardless's pricing page says its Advanced and Pro plans include Success+, which it describes as automatically recovering up to 70% of any payments that fail. Standard does not list it. If your gym collects its Direct Debits through GoCardless on Standard, moving to Advanced adds Success+ at a higher per-payment fee. The page doesn't say how retries are scheduled, so ask GoCardless before relying on it. Your front desk still checks the failures that remain, and your membership terms should say what happens when a payment fails. Do not add charges for failed payments unless your contract clearly allows them.

A 300-member gym in Reading collects £35 a month from every member by Direct Debit through GoCardless on the Standard plan. About 12 payments a month fail.

About £90 a month, if Success+ clears 8 of 12 failures (an assumption, not a promise): 80 minutes saved is 1.3 hours, worth about £20 at £15 an hour, plus 2 payments recovered, 2 x £35 = £70. Total GoCardless fees on Advanced are about £191 a month, against £165 on Standard. Cost here is the extra for Advanced over Standard: a £35 payment costs 1.25% + 20p, about 64p, against 1% + 20p, 55p, so 300 payments is about £191 against £165, £26 more, or about £32 with VAT you can't reclaim. You pay the base fees on every payment anyway. Fees exclude VAT on GoCardless's page.

1. 1Pull last month's failed payments from GoCardless and count them, so you know your real failure rate before changing plan.
2. 2Compare the fee on your actual payment amounts: Standard 1% + 20p against Advanced 1.25% + 20p, each capped (£4 and £5).
3. 3If the extra fee is worth it, switch to Advanced and ask GoCardless how Success+ retries failed payments and when members are told.
4. 4Update your membership terms and join form to say what happens when a payment fails, in plain words.
5. 5Each month, check the payments that still fail and contact those members yourself.

• Success+ is 'up to 70%'; your rate may be lower. If few of your failures are recoverable, Standard is cheaper.
• If your gym software already bills through GoCardless, your plan may be set by that supplier; check before changing anything.
• A failed payment can mean a member has cancelled at their bank or is in difficulty. Contact them and be fair; don't add penalty charges your contract doesn't clearly allow.
• Fees are per payment, so a larger or smaller membership changes the cost; recalculate if your price or numbers change.