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Payment 101: Routing & Connectivity

Declined transactions are a lose-lose for every business – they mean lost revenue for you and a negative experience for your customers. But the payment processing industry has a confusing multitude of players that make it a complex ecosystem to navigate. So how can merchants route payments easily, and in a direction that will save money and reduce friction?

Once your business accepts a payment method, it must then flow through a complex ecosystem of multiple parties: payment service provider (PSP), acquiring bank, card network, and issuing bank. Payment routing is the path the transaction takes after a customer makes a purchase.

But managing the route these transactions take can be a challenge that drains resources. And if the transaction’s final destination is ‘declined’, it can drain your bottom line too.

That’s why Intelligent Routing is so important. It controls the route, guiding each transaction to the acquiring bank most likely to approve it. So, when one acquiring bank has declined a transaction, it is automatically routed to another acquirer for approval. Clever, right?

So clever that, along with tokenisation, routing is one of the services most widely demanded by Payment Orchestration users today.

Making routing more intelligent


A Payment Orchestration Platform allows merchants to add multiple payment processors, which minimises risks involved with using a single processor and simplifies the complex payment process.

It means that, with minimal effort, merchants can route transactions for approval based on specific criteria, prevent potentially problematic transactions from being submitted, and even retry transactions on an alternative gateway.

What’s more, Payment Orchestration helps create a routing offering that’s tailored to businesses across industries, business models, and sizes, by connecting them to the right acquiring banks based on the characteristics of each company. That way, when a shopper comes to your site and submits at checkout, the transaction is routed using a variety of factors to optimise payment approval. If the transaction fails, it is automatically rerouted in real time.

Our Payment Orchestration Platform, Velocity, boasts an intelligent routing engine that allows the maximum number of transactions to be approved and offers more than 400 ways to process payments, so that your customers have the right payment type, in the right market, at the right time.

Automatic failover rules route failed transactions to a different provider when one is down. This feature becomes valuable when you consider that 42% of potential eCommerce customers are likely to abandon their carts if their cards are declined. Automatic failover ensures that every payment is processed, every time.

Such optimised payment routing of course relies on rich data. But accessing and interpreting vast amounts of data is yet another time-consuming challenge. Leveraging the insights Velocity can gather will help identify areas where you can further improve your payment success.

All businesses are looking to increase their payment conversions and often struggle for the best ways to do so. Intelligent Payment Routing is one way we can help.

When a transaction fails, you lose more than the immediate revenue, you also add friction to the customer experience and risk losing future business. Payment Orchestration enables you to redirect a failed transaction to a different provider to not only increase the chances of a successful transaction but enhance the overall experience.

So, what happens next? Once a transaction is made, the next step of the payment journey takes place and the consumer trusts you with their payment details. Next time, we’ll look at tokenisation and vaulting, and how they work as the uncrackable safes of the 21st century.

Have questions about your payment ecosystem?

Reach out to our experts below to set-up an introductory conversation about how we can improve your profits through payment orchestration.