It really is a tough situation when an arrangement fizzles out like yours has.  You don't want to continue, but you don't want any drama and you certainly don't want to hurt her feelings.  You have several options.

1.  Ghost her.  Just don't reply at all.  She will eventually get the message, but since I HATE getting ghosted, I try not to do this to anyone.

2. Make up a plausible excuse.  You can't continue seeing her due to an unexpected health issue, a problem with work, your wife is getting suspicious, you are low on money, etc, etc.  this allows you both to save face and move on, although it def is dishonest.

3. And finally, be honest.  Tell her that all arrangements have a natural life span and eventually run their course.  You have appreciated having her friendship, but now feel there's insufficient chemistry to sustain and ongoing arrangement.  Wish her best of luck.  Then block her number.  Whether a severance $$ is appropriate is up to you, but I have never done that.

As Papa Sweet noted, all arrangements end eventually.  So this is a good discussion to have right now.  

 
Papa gave you some strategies to consider.  I will aim a bit more strategic by outlining some ideas on how to get out gracefully.  

 
1. Always make it about you, never her.  Whatever reason you present, make sure it's some issue that prevents you from continuing, and never something "wrong" with her.  She can't/won't get defensive if you don't get offensive by saying she's boring, not sexy enough, too flakey, etc. No, you have an issue that only you can address.  

 
2. Try to never burn bridges.  You never know when things might change. She may reach out to you down the road and ask for a one-off. Or you may decide, after looking for replacements, that she is the best option after all.  In addition, ensuring that you part as friends (or at least not as enemies) greatly reduces the risk of her trying to burn you later.  

 
3.  I generally don't like the idea of "severance," though I admit I have paid it in the past. If you feel it will help ease her out of the arrangement, consider keeping the amount reasonable. Now what's reasonable will vary a lot based on your budget, her current allowance, your lost opportunity costs of paying funds that could be used for other things (like a new SB), etc.  I'd advise evaluating how much pain she will suffer without your funds. If you are paying her monthly rent, then she may find it difficult to replace that much cash in less than 30-60 days. But if you are just covering her "fun money" (for shopping, make up, drinks with the girls, etc.), then her actual pain is minor and she will probably be ok if it takes her 1-3 months to find a new SD.

 
Final note on this, consider if you want to give her a lump sum payout, or pay over time. I was paying 75% of the rent for an SB back in 2019. When I broke up with her, I continued to make the next 2 partial rent payments. That worked out well and we are still friends today (As evidenced by the lack of slashed tires on my car and the lack of arson fires started on my house. LOL).

 
4. As much as possible, do not lie. Exaggerate if you must. But try to avoid lying. As you said, she knows your RW info. So how hard would it be for her to try to verify your claims?   Better to let her find crumbs that support your story and let her assume you were trustful, then making it easy for her to call BS on you.  

 
Please let us know how you handled it, and how it went.  We can all learn from each other's experiences.  

 
Life is good

 
The Cat

Saying you are bad at sex is not gonna save you drama.

In this case I would be mostly honest.  Telling her it feels like it has fizzled and you both are not having fun anymore.  If you feel it she does too.  Doesn't mean she will just accept it as she probably needs the money.  But she can hopefully take the hint you are moving on.

Once a wife is suspicious you have to account for all your free time.  I think "my wife suspects" is the magic words to put a hold on activities for the foreseeable future.

In a similar situation, I told SB that due to recently diagnosed cardiac issues, I could not perform.  Hard for her to argue with that.  As for severance, as noted above it is very situational specific.  But unless it is clear she is screwed without some transitional support, I would stay away from it. My experience with an SB who gad my RW details was that what I thought was a generous offer turned into a hostile negotiation since she realized it was over and she wanted all she could get on the way out.