Recurring donations marked as "pending" in Civi in Test Mode

Version 5.2 of the extension. Using Test mode.

When I create a single payment, it works as expected. But when I set up a recurring payment, in Civi it remains marked as "incomplete or pending", despite the subscription being successfully created in Stripe.

Perhaps it is waiting for an acknowledgement from Stripe to be sent to the webhook URL?

I have entered this webhook url: <site>/civicrm/payment/ipn. I have attempted to test it from within Stripe. Whatever event I choose to send, I get "Test webhook error: 401" and "Invalid encoding: ISO-8859-1".

Perhaps the webhook needs to be set to the correct version. However the version specified in the extension docs is 2018-11-08 but that option is not available when created a webhook - see screenshot.