With AI finding its way into more software the associated credits have seen a lot of misuse through plan jumping. This is the action where a user upgrades to the highest tier to get more credits, uses up all those credits and then immediately downgrades back to the basic (or even free tier) and gets a prorated price on their subscription - effectively not paying for those credits.
The solution proposed by many and implemented by payment providers was to delay downgrades to the next renewal date unless support was contacted to handle special cases.
Currently the Paddle API does not yet support this out of the box. As the advanced customer portal for Paddle, we have implemented this as part of our portal offering.
This update provides four distinct settings to manage downgrades ranging from completely disabling them to delaying them until the current term is over.
Four Independent Downgrade Controls
You now have granular control over subscription downgrades with these new portal settings:
- Delay Plan Downgrades to Next Renewal - When enabled, customers moving to a lower-tier plan (as defined by the order of plan in your portal) will have the change scheduled for their next renewal date instead of being processed immediately with proration.
- Delay Annual-to-Monthly Changes to Next Renewal - Specifically controls when customers can switch from annual to monthly billing. When enabled, these changes take effect at the next renewal rather than immediately.
- Disable Plan Downgrades - Completely prevents customers from moving to lower-tier plans through the self-service portal. They'll only see their current plan and upgrade options.
- Disable Annual-to-Monthly Changes - Prevents customers from switching from annual to monthly billing cycles, helping maintain predictable revenue and reducing churn from billing cycle changes.
Changes to Customer Portal Experience
The customer portal now intelligently filters available plans based on your settings:
- When plan downgrades are disabled, customers only see upgrade options
- When annual-to-monthly changes are disabled, customers on annual plans won't see monthly options for their current tier
- Clear messaging explains when changes will take effect or if the subscription is subject to a change on next renewal (and options to cancel that change).
Changes to Portal Administration
Because this scheduling is handled in Boathouse instead of Paddle you have full insight into the scheduled changes from your portal administration under the new "Scheduled Changes" page.
It allows you to:
- View all pending scheduled downgrades
- See which subscriptions have changes scheduled
- Cancel scheduled changes if needed
- Track execution status and results
How are downgrades scheduled?
Once an hour Boathouse checks for any pending downgrades. A downgrade is pending if the renewal date is within the next 12 hours.
The subscription is downgraded with proration set to 'not bill', ensuring the user is not refunded for the remaining 12 hours and the plan is changed before the next billing date.
The 12 hour period is a compromise between the lock period Paddle applies around a subscription renewal time (where subscriptions cannot be updated and therefore a plan change is not possible) and a reasonable timeframe that the user might expect to see the downgrade come into effect.
Boathouse will check for any changes to the plans made in Paddle and only execute a plan change if the old plan is still in effect at the point in time of the scheduled downgrade.
Paddle Integration
The master data stored for this feature is stored in Paddle's custom data field for subscriptions. If this field is deleted the scheduled change is not performed.
