Free is great, except when free costs you.
You don't have to pay anything, but you're going to be losing a lot of customers if you choose to go this route. That's money right back in your pocket.
It's not that this dunning template won't work. You will see results with this, but just not great success. Standard dunning efforts only recover around 15% of failed payments, and this is just 1 email out of a whole sequence. Recovering lost subscribers is a continual process that will continue to require time and energy.