Payment gateways are the core of any transaction from consumer to merchant. A key metric that makes a payment gateway good is its transaction success rate. This Macropay review will explore the payment gateway success rate and the factors affecting it.
What Is Payment Gateway Success Rate?
The payment gateway rate is the number of successful transactions compared with the total payment requests.
For example, let’s consider a payment gateway that handled 100 total transactions, and only 80 out of them were successful (transferred money from consumer to merchant). In this case, the success rate of that payment gateway was 80%.
However, the payment gateway or transaction success rate does not correlate with merchants’ revenue. Several customers make repeated attempts for payment after the failure of one, until the transaction is successful. Many consumers, one the other hand, quits the purchase after a transaction failure.
Failures in payments can make a massive dent in online businesses. The payment failure rate in Europe averaged 26% in August, primarily due to the performance of EMVCo 3D-Secure version 2 (3DS2), an authentication protocol for online card transactions in the continent.
At this failure rate, European merchants risk losing more than €82 billion of sales in a year.
Factors Affecting Payment Success Rate
Many factors can result in a low payment gateway success rate. While there are no definite reasons behind a low success rate, several market studies have identified key factors affecting the payment gateway success rate. These are:
- Geography: The place and platform of payment is a key factor for the transaction to be successful. The payment gateways of one country may not accept cards issued in another country.
- Debit or credit card: Credit cards usually have a better chance of payment success than debit cards.
- Tier of cards: High-end cards have fewer chances for payment declines than entry-level cards.
- Payment processor: The company (like Visa, Mastercard, American Express etc.) issuing a card can also impact the success rate.
- Payment gateway: The payment gateway itself can be responsible for payment failures. Because of this, merchants should be careful in choosing the payment gateway.
How to Increase Payment Gateway Success Rate?
The payment gateway success rate is very crucial for merchants. While the payment gateway is primarily responsible for this, merchants can also take several steps to strengthen this success rate. Some of these steps are:
- Saving payment information: Merchants should save the payment information of consumers, after they give consent. It will allow recurring consumers to make payment faster on the platform.
- Enabling guest checkout: While saving payment information is good, this does not mean the merchant should force every consumer to create an account. Platforms should have the option to purchase as guests without creating an account.
- Offering payment options: Online merchant platforms should have ample payment options. It includes global options like card payments and PayPal along with popular local payment options, like iDEAL in the Netherlands and SOFORT in the DACH region.
- Smart routing: Merchants should implement a smart payment routing, meaning when one gateway is down, they should route the order to an alternative payment gateway.
Macropay In Review: Increase Transaction Success Rate
Macropay provides an online payment gateway that can accelerate your sales, making the payment process smooth and fast. It also makes the onboarding process fast and emphasizes making the entire process transparent. The key features of our payment gateway are:
- Settlement in local currencies
- Integrated fraud protection tools
- Real account management system
Reach us at [email protected] to know our service better. For more insightful Macropay review, keep following our resources.