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What are some best practices for implementing a free trial period in web applications?

Should you collect the customer's credit card information upfront, or prompt them when their free trial is up? Personally, I feel I would be more inclined to sign up for a service if I don't have to give the company my CC info.

How would one handle reverting back to a free plan after their trial period plan ended and they have exceeded a setting for the free plan. For example, they created 5 projects, but the free plan only allows for 2 projects. Give them a grace period to resolve the account -- by signing up for the plan or to manually update their account to adhere to the free plan settings? Thoughts?

Thanks Graeme