The Impact of Credit Card Requirements on SaaS Free Trials

May 29, 2024 5 Min Read

In recent discussions with our customers, a recurring theme has been the impact of requiring a credit card upfront for free trials. Many have expressed concerns about balancing the attraction of high-quality leads with maximising sign-ups. This blog explores the benefits and risks associated with requiring a credit card before allowing a free trial for high-value SaaS products.

Conversion to Paid Users

Requiring a credit card typically results in a higher conversion rate to paid customers. Users who provide their credit card details are generally more serious about evaluating the product, leading to a higher likelihood of conversion. For example, conversion rates for trials requiring a credit card can reach up to 60%, compared to around 17% for those that do not require a card.

Risks Associated with Not Requiring a Credit Card

  1. Lower Quality Leads: Without the credit card barrier, many users may sign up just to explore without any serious intent to purchase. This leads to lower-quality leads and potentially lower trial-to-paid conversion rates.
  2. Potential for Abuse: Users may create multiple accounts to exploit the free trial period indefinitely, leading to increased resource consumption and potential abuse of the system.

Benefits of Requiring a Credit Card

  1. Higher Quality Leads: Users who provide credit card information are generally more committed and serious about the product, resulting in higher quality leads and better trial-to-paid conversion rates.
  2. Reduced Time-Wasters: This approach helps filter out users who are not genuinely interested in purchasing, saving resources and efforts for the sales team.
  3. Better Data and Insights: Accurate contact information from serious users provides valuable feedback and insights, aiding in product improvement and decision-making.
  4. Enhanced Security and Reduced Abuse: Requiring a credit card helps prevent abuse of the trial system, ensuring fair use and better resource management.
  5. Increased Revenue per User (RPU): By focusing on higher-quality leads, businesses can boost revenue per user and align their strategy to maximise revenue rather than just increasing user numbers.
  6. Commitment Indicator: Users who provide credit card details are more likely to thoroughly evaluate the product and convert to paid customers, showing a higher level of commitment.

Benefits of Not Requiring a Credit Card

  1. Increased Sign-Up Rates: Lowering the entry barrier results in higher sign-up rates as users are more willing to try the product without an initial financial commitment.
  2. Building Trust: Not requiring a credit card can build trust with users who are cautious about unauthorised charges, enhancing the company’s reputation.
  3. Wider Audience Reach: This approach allows the product to reach a broader audience, which is beneficial for new or less established products seeking to build a user base and gather feedback.
  4. Data Collection and Feedback: With more users signing up, the company can gather extensive feedback to understand user needs, identify issues, and improve the product.
  5. Improved User Experience: A simpler sign-up process enhances the initial user experience, leading to a more positive interaction with the product.
  6. Avoiding Negative Experiences: Requiring a credit card can sometimes lead to negative experiences if users forget to cancel their trial and are automatically charged. This can result in refund requests and potential negative reviews or word-of-mouth, which can harm the company’s reputation.
  7. Potential for Higher Overall Conversions: While individual conversion rates might be lower, the overall number of conversions can be higher due to the larger volume of users trying the product.

Drop-Off Rates

When a credit card is required, sign-up rates typically drop due to the added friction. However, the users who do sign up tend to be more qualified and have a higher likelihood of converting to paid customers. Conversely, trials without the need for a credit card see higher initial sign-up rates but may experience lower conversion rates to paid plans due to the higher volume of users who sign up out of curiosity without serious intent to purchase.


For high-value SaaS products, the choice between requiring a credit card or not for a free trial should align with your business goals—whether you prioritise acquiring a large user base quickly or focusing on higher quality leads and conversions. Understanding these dynamics can help you make an informed decision that supports your overall strategy and growth objectives.

Let’s Talk (talk with CIVIC)

We understand the intricacies and challenges of optimising your SaaS free trial strategy. Our expertise in digital marketing and SaaS growth strategies positions us uniquely to help you navigate these decisions. By partnering with us, you can leverage our experience to:

  • Increase your conversion rates with tailored strategies that align with your business goals.
  • Enhance your lead quality and customer acquisition process.
  • Optimise your trial processes to balance high sign-ups with high-quality leads.

We pride ourselves on being approachable and friendly, always ready to lend a helping hand. Our team of experts is here to support you every step of the way.

Reach out to us today to discuss how we can support your SaaS business in achieving its growth potential. Let CIVIC be your trusted partner in driving your SaaS success.

Originally drafted as a blog for Civic’s website but contains some hopefully useful thoughts.