A seamless and efficient payment procedure is crucial in eCommerce since unsuccessful transactions hurt profits.
Failed payments are those rejected by the acquirer or issuer in the payment flow for reasons like:
- Card or contact information that is missing or erroneous
- Complications with the authentication procedure
- Not enough money in the account
Some of these concerns are customer-related and cannot be directly addressed by companies. Businesses may reduce unsuccessful transactions owing to technical issues and a lack of payment processing infrastructure backups. Implementing a dynamic routing-based payment processing infrastructure helps reduce these issues.
The Payment Failure Landscape
According to LexisNexis® Risk Solutions’ Accuity, unsuccessful payments cost the global economy $118.5 billion in fees, labor, and lost revenue in 2020. On average, missed payments cost large organizations over $200,000.
Research shows that unsuccessful transactions negatively harm consumer experience. Additionally, 37% of firms reported a significant effect on customer service, while almost 50% reported some impact.
Smart Routing Payment Fixes It!
Choosing a payment infrastructure with dynamic routing may reduce technical issues and transaction failures.
What’s dynamic routing? First, we must examine static routing and payment processing.
Smart routing payment gateway for E-commerce transactions occurs once the user hits “pay now” on the check-out page. After that, the transaction “route” involves many steps:
Payment service providers, acquirers, issuers, and fraud protection services handle these.
Manual reconciliation is tough since it requires reconciling data from several suppliers and access points.
Smart routing automatically routes your transactions to the most efficient and cost-effective path at the moment of purchase, solving these issues. Smart routing may automatically change the transaction route to approve the transaction, reducing technical mistakes.
This optimizes cost, time, and payment method availability. Smart routing engines, operated by machine learning algorithms, improve routing accuracy with more transactions.
Dynamic routing effectively enables you to sell worldwide by offering local payment options and quicker authorized transactions on the acquirer with the greatest approval rates for the transaction parameters in that location. But the list continues. Smart routing and fraud protection services increase authorization.
Looking at smart routing and how it works, fewer unsuccessful transactions are merely one benefit:
- Saving fees and charges
- Transactions faster
- Global availability
Smart Routing And Payment Coordination
Smart routing powers payment orchestration services, which manage various payment gateways on one infrastructure. Redirecting payments to the best supplier using machine learning, Akurateco combines finances, offers Payfac as a Service, and provides management over payments from a single point of access.
As was previously said, routing is a major factor to consider when deciding on the ideal payment infrastructure for a company. Smart routing may be the answer to minimizing unsuccessful transactions while reducing the expenses of costly integrations and manual reconciliation, whether the firm is operating locally on a tight budget or expanding worldwide and in need of an investment in a more cost-effective solution.