About 90% of consumers in the UK have made a digital payment in the past year, highlighting the increasing need for seamless and secure payment options1. Businesses, however, may feel challenged by the task of delivering an ideal customer experience for all payment methods across channels and devices.
Processing issues in the form of false fraud alerts, out-of-date cards and multifactor authentication can also lead to declined transactions and prevent successful transaction completion.
How can businesses provide an outstanding customer experience while elevating their ecommerce environment? It all starts with authorisation rates and authorisation optimisation.
The authority on authorisation optimisation
When a credit card or debit card is declined by the issuing bank during payment processing, it’s not always clear why it was declined or if you can resubmit and retry. Merchants typically receive standard decline codes from the customer’s bank. Payment decline reason code (PDRC) services offer detailed information on what the codes mean and the action that can be taken on a declined transaction. Acting on this information can increase authorisation rates and customer satisfaction.
A high number of failed transactions can disrupt your business, just one reason you should aim to improve authorisation rates, which can also help increase revenue, the checkout process and the entire customer experience.
What is an authorisation rate?
An authorisation (auth) rate is the percentage of transactions that successfully pass through your payment authorisation process, resulting in a completed transaction.
Having zero card-not-present (CNP) declines — or a 100% authorisation rate — is nearly impossible, especially if you process a lot of payments. But closely monitoring your authorisation rate can help you identify ways to reduce transaction declines.
While there is no one solution, partnering with the right payment provider — and implementing these five tips — can lead to better results in the long run.
5 key ways to improve your authorisation rates
As a payment processor, you have five key ways to turn payment information into successful transactions.
1. Enable tokenisation
You will improve your authorisation rates by enabling tokenisation. That's when a token shields your customer's personal payment data and card information. This substitution makes it much more difficult for an unauthorised individual to access or steal a customer's data or interfere with a customer’s bank.
Tokenisation not only adds security and reduces the chances of identity theft, but tokenised payments also have, on average, nearly 6% higher authorisation rates than traditional ecommerce transactions.
2. Accept digital wallets
Some leading digital wallets, like Google Pay and Apple Pay, have tokenisation built into their platforms. This fraud prevention tactic significantly reduces the risk of cybercrime, resulting in safer transactions.
But that's not all. Digital wallets also provide a faster and more seamless payment experience, which is especially convenient for every mobile user.
3. Use card account updaters
Your payment partner should offer card account updater services. These card issuer services automatically renew expired cards and update any changes made to the card so your customers' information is always current.
And it can significantly reduce the number of card-not-present declines and improve your authorisation rates — benefiting you and your customers alike.
4. Add security layers
You have likely heard of 3DS2. This multifactor authentication protocol, designed to prevent fraudulent transactions, adds security layers beyond just basic card data for card networks. With 3DS2, additional security questions or biometrics are used to further decrease the chances of fraud, minimize friction and improve authorisation rates. It complies with the European Union's Payment Services Directive (PSD2), implemented by the FCA in the UK, and the enforcement of Strong Customer Authentication (SCA).
By implementing 3DS2, some card processors have reported an increase in authorisation rates by up to 10%. This security feature is a simple but powerful way to protect your customers’ transactions. And it also allows for higher authorisation rates.
To optimise your 3DS2 success rates, you can track authorisation and authentication rates as well as common technical glitches and error codes to find areas for improvement. Likewise, when your systems are up to date, you will also better optimise 3DS2 rates, not to mention the overall payment and customer experience.
Global Payments UK notably processed 151 million authentication requests as 3DS with a success rate of nearly 92%.
5. Verify the accuracy of your information
When you add specific merchant and customer information, you can improve both the quality of your credit card and debit card transactions and your issuer authorisation rates.
For starters, make sure your Merchant Category Code (MCC) is accurate. An MCC is a four-digit number that classifies the type of goods or services that you sell. If you are unsure if you are using the correct MCC code, contact your payment partner to get more information or make any necessary updates or changes.
Be sure to get as much billing information as possible from your customers. More data points contribute to a stronger and more accurate authentication process, while making it harder for unauthorised individuals to make fraudulent purchases.
Higher authorisation rates means more revenue
Even slight improvements to your authorisation rates can positively impact your business operations: An increase as small as 1% can capture millions of pounds in additional revenue each year for a large business.
Higher acceptance rates translate into more sales, as does fewer fraudulent transactions. Tracking conversion rates and other key metrics can also help your business grow sales and revenue.
Looking for a better checkout experience?
Taking payments is foundational to your ecommerce strategy and success. With that in mind, payment processing issues and low authorisation rates are frustrating for businesses of all sizes.
We help businesses worldwide analyse why payments are failing and automate a smoother transaction process while optimising your ecommerce environment and ultimately improving the entire customer experience. Global Payments helps businesses worldwide with fraud detection, payment flow and success rates to surpass customer expectations. We proactively work with cross-border businesses to reduce declines and bolster authorisation rates.
Global Payments can help your business increase payment authorisation rates, integrate new payment methods, reduce routing issues and manage the payment authorisation process with ease. If you are facing abandoned carts, challenges with chargebacks or customer payment issues, we can help.
Contact us today to learn how we can help you streamline payment processing and increase authorisation and approval rates. Whatever your size or scale, our solutions support your ecommerce growth. Let’s get started!
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