Three simple but powerful questions you should ask your payment provider

Payment service providers (PSPs) exist to bring all financial parties together with the aim of delivering a frictionless payment experience for you and your customers by processing payments quickly and efficiently. But how can you be sure you’re getting the most from your payment provider? A good start would be asking your Acquirer and PSPs these three questions to determine if you’re getting the best service and innovation possible.

1. Does your product help my organization improve authorization rates?

Payments can be a strategic advantage and provide a competitive edge if executed correctly. Features to look out for are things like failover functionality, intelligent routing, soft decline retries and embedded payment links.

Most merchants combine separate payment channels, which leaves them vulnerable to single points of failure. Implementing a Payment Orchestration Platform, such as Velocity, improves resilience by layering redundant systems that can take over processes in the event of a failure. It means your organization will benefit from higher transaction success rates and lower payment costs as the orchestration platform automatically reroutes to a second or third alternative processor to complete the transaction.

Soft Declines – where a card number is probably valid but was denied by the issuing bank for data quality issues, such as invalid expiry date or authentication data, account for a significant percentage of all declines and it’s important to work with your PSPs to build strong resubmission strategies. Merchants can submit a retry when they receive specific decline code categories from issuers that indicate there are data quality issues. The issuer may approve the transaction if the merchant then provides valid data.

Pay-by-Link is another simple and useful tool PSPs can provide. It lets you send digital invoices by email or SMS including an embedded payment link that allows your customers to pay with all supported payment methods through a secure link. Additionally, retargeting customers who drop out at the payment stage with Pay by Link statistically prove to increase conversion rates.

Other features of a solid payment strategy are the ability to store customer cards to enable one-click payment in all channels and to easily add a range of payment methods. Merchants in all verticals need to recognize the importance of accepting a wider range of alternative payment methods (APMs) to meet new customer expectations.

APMs are growing in popularity and in many countries are already the de facto way to pay online. For example, 57% of German shoppers prefer to use PayPal when shopping online and Netherlands consumers make 60% of their online purchases with the local bank transfer payment, iDEAL.

2. Can your solution intelligently route all my transactions based on key metrics?

This is essential if you’re looking to reduce operating costs. And let’s face it, who isn’t?

Smart routing means transactions are sent through the channel where they are most likely to be approved. PSPs that offer transaction routing technology are best positioned for international merchants and cross-border payments.

Intelligent routing is one of the key benefits of Payment Orchestration. With a reliable Payment Orchestration Platform, you can implement a multi-acquirer strategy and dynamically route transactions to the optimal acquirer based on geographic location, interchange cost, uptime and approval rates.

3. How does your solution provide insight to optimize my FOPs and ecosystem?

All businesses need to make insightful decisions to implement the most efficient payment strategy. Payment Orchestration is driven by data that allows you to zoom in on each market, channel, payment provider and customer segment and puts control of your payment ecosystem back in your hands.

Our Velocity platform is a great example of data visibility. It features a real-time dashboard that gives users access to real-time and trending data from all digital payments and monitors payment transactions. You can also benefit from customized reporting. Simply define the reports you want to receive automatically, with all the KPIs and payment data you need by market, channel, payment provider, payment methods and transaction type.

Without Payment Orchestration, your business can be locked into static acquirer routing, or routing determined by a third-party payment gateway. Worse, you risk eroding your per-transaction profits by paying needlessly high fees for sub-optimal acceptance rates. Asking these three simple questions is a quick way to evaluate the effectiveness of your Acquirer and PSPs and ensure they’re working as hard for you as you are for your customers.