Manage Component Allocations for Different Payment Methods

This help article explains how Component Allocations work in Advanced Billing, including how charges accrue for invoice-based and automatic Subscriptions, how proration is handled, and what occurs when a component allocation fails. To ensure accurate billing and revenue reporting, you must report each component’s status or amount to Advanced Billing.

Related Topic: Component Allocations Overview

Component Allocations for Invoice-Based Subscribers

If you allocate any type of component to an active Subscription that uses an invoice-based payment method, charges accrue until the next billing period.

When you add a component using any proration scheme, charges accrue until the next billing timestamp.

Component Allocations for Automatic-Based Subscribers Without a Payment Method

The same allocation rules apply to automatic-based Subscriptions.

If a Subscription is active or past due and does not have a payment method on file, but is configured to use an automatic payment method, you may still allocate components.

For automatic-based Subscriptions without a valid payment method:

• Allocated components accrue charges until the next billing period.
• Under any proration scheme, charges accrue until the next billing timestamp.

Failed Component Allocations

If you allocate a component to a Subscription and the charge fails, the outcome depends on the component type.

Failed Quantity-Based Components

If you select Charge immediately and choose an upgrade charge option (prorated or full), and the payment fails, you will see the following warning:

In this scenario:

• The component quantity change is saved.
• The outstanding balance increases by the failed charge amount.
• The charge accrues until the next renewal.

Failed Metered Components

Metered components are not charged immediately when allocated.

When allocating a metered component:

• The current balance does not increase immediately.
• The component usage is recorded on the Subscription.
• The allocation appears in the Activity tab.
• The Next Billing amount increases by the cost of the metered usage.

If the payment method fails at the next billing timestamp, the Subscription transitions to past due.

Failed On/Off Components

On/off components use proration. If an immediate charge fails, the behavior matches the quantity-based scenario described above. The allocation is saved, and the outstanding amount accrues until renewal.

Failed Prepaid Allocations

Prepaid components do not use proration, but each allocation is charged immediately. If the payment fails:

• The allocation is saved.
• The outstanding amount accrues until renewal.
• The Subscription balance increases by the failed charge amount.

If the Cost Decreases

When you decrease the number of components allocated to a Subscription, Advanced Billing provides the following options:

• Credit the prorated amount of the difference in quantity
• Do Not Credit

Options to control price decreases

These settings determine whether a Transaction credit is generated when component quantity decreases.

Example:

1. On January 1, a Customer signs up for a $50.00/month product.
2. On January 1, you allocate 100 quantity-based components at $1 each, totaling $100.
3. The Customer pays immediately for this component allocation.
4. If you select Credit the prorated amount of the difference in quantity, the Customer receives a Transaction credit for the unused portion of the billing period.
5. If you select Do Not Credit, no credit is generated.

Transaction examples during proration