4. Automated instant retry
Another helpful element when seeking to boost payment approval rates is a good Instant Retry tool, which can automatically re-route failed payments to a merchant’s bank account.
PayU’s Instant Retry feature is a unique capability that is used to save failed transactions by retrying them through pre-configured routing rules. Using the PayU Decision Engine for easy setup, merchants can manually define retry criteria according to specific error codes, card country, or other factors.
With Instant Retry, e-commerce businesses can increase payment approval rates and recover payments that would otherwise be lost due to both hard as well as soft declines.
5. 3DS consolidation
The 3D Secure 2.0 payment protocol was developed in response to the European Union’s Secure Customer Authorization (SCA) requirement, which was implemented in 2019 and is designed to ensure more secure online payments while protecting consumers against fraud.
But while 3DS 2.0 can bring a number of benefits to merchants, it can also result in lower approval rates in locations outside the EU with less stringent anti-fraud regulations.
Given the variation in the regulatory landscape, a good payment processor can help merchants maintain optimal approval rates by tailoring the 3DS strategy and constantly engaging with merchants and banks. Smart Routing tools, for example, can help merchants route payments through the optimal 3DS protocol (3DS 1 or 3DS 2) based on processing location.
Many modern solutions use merchant fraud data to develop a 3DS exceptions strategy. This includes transaction monitoring as well as dedicated merchant reports to ensure optimal approval rates during the 3DS adoption stage.
Merchants should also make sure that their payment processor maintains close relations with banks in order to ensure optimal acceptance of 3DS exceptions.
6. Network tokenization
A final way that merchants can increase their approval rates is by using network tokens to authorize payment transactions.
How does network tokenization work? When a customer enters their card details, they are immediately replaced with a card network token. The token is unique for both the merchant and their customers. When a customer makes a payment, the payment system transmits the token into card details.
What if the customer’s card details have changed? The system will map the new details with the token. This allows merchants to achieve higher approval rates and capture higher transaction volume by avoiding lost and/or expired card declines.
Naturally, network tokenization also leads to fewer false declines as tokens provide more information and greater visibility to card issuers during payment authorization, helping to build a more secure and frictionless transaction flow.