What is a SaaS Subscription Pause Feature?

A subscriber pause stops billing and generally also access, without ending the customer’s account. A subscription resume (or reactivate) is usually triggered manually (or by a set period of time), and the user’s data, settings, and history remain untouched.

• Variable pause time — fixed period or indefinite pause ended manually by the customer.
• Resume on auto — the return of customer funds and access occurs automatically at a particular time, without any human operational input.
• Saving data — the user’s configuration, integrations, and content are untouched.
• Self-service — the self-service dashboard provides customers with pause and resume subscriptions, which may affect the frequency of support inquiries.
• Caps on pausing — to prevent abuse, set limits on how often the feature can be used or how long it lasts.

Pause and cancel represent distinct approaches to a customer’s intent to discontinue payment, though they are not interchangeable. Customer engagement concludes through cancellation, identifiable by actions such as account deactivation or changes in service level. The effort to re-establish this customer connection could be similar to that required for initiating a relationship with an unfamiliar brand. 

Pausing allows the customer’s account to remain intact with dormant billing, and reactivating such customers often requires fewer resources compared to acquiring new ones.

Introducing a pause function when a customer is close to canceling presents an option that allows for temporary disengagement from the product, rather than a complete disconnection, which could affect the likelihood of subsequent re-engagement.

Guidance points for SaaS teams:

• Adjusting pause periods and times can influence the product’s recurrence pattern.
• Email users when a pause will end so they get ready and are not caught off-guard if a payment goes through automatically.
• The pause option is accessible to customers from both the cancellation screen and the account section, typically used for changing settings.
• Analyze the number of times paused subscriptions are resumed as opposed to canceled to evaluate the effectiveness of the service.

A temporary subscription halt affects monthly recurring revenue (MRR), and finance department awareness of such instances is appropriate. Agreement terms would ideally define the cessation of responsibility following an extended pause.

The pause​‍​‌‍​‍‌ feature in the billing system usually requires adding a new subscription status field other than “active” and “canceled,” often “paused,” and implementing mechanisms to stop invoices, freeze the date of the next renewal, and schedule an automatic resumption. Modern subscription billing platforms and Merchant of Record providers often incorporate pause functionalities into their system, which may reduce the requirement for manual in-house logic development. The proper handling of the pause function is related to avoiding situations where customers might experience double billing upon resumption or the non-application of proration credits.

Depending on intention and how long a customer might want to remain on pause, the decision between cancel and pause would naturally change. Most of the time, if a customer is intending to get back either within a few weeks or months, the pause option would be the ideal one as it saves their data and settings and avoids a whole re-onboarding process. The cancellation of an account belonging to a user with no expressed intention of returning provides a method to conclude its inactive status.

Ask before deciding:

Are there observed instances of customers canceling and subsequently resubscribing within a few months? Is your product used seasonally or tied to project-based work? Would a temporary billing hold reduce support tickets and win-back campaigns?