How to optimize approval rates: 15 actionable tips

Enhancing your approval rate is crucial for smooth transactions and customer satisfaction. Here are 15 detailed strategies to help you achieve higher approval rates, integrating insights from modern payment orchestration concepts.

Implement fraud screening before authorization

Start by introducing fraud screening measures before transactions reach the authorization stage. By identifying and filtering out high-risk transactions early, you reduce the number of fraudulent attempts reaching the issuer. This not only improves your overall approval rate but also builds trust with the issuers over time. Utilize real-time purchase data and shopping history to detect suspicious activities.

Keep card information current with automatic updates

Expired card details can cause transaction declines. Use an account updater service to automatically refresh cardholder information. This ensures that recurring transactions use the most up-to-date card details, minimizing declines due to outdated information and providing a seamless experience for your customers.

Leverage network tokens for secure transactions

Network tokens replace traditional card numbers for online purchases, staying valid even if the underlying card details change or expire. This improves transaction approval rates by ensuring that the most current payment credentials are used, reducing the chances of declines due to expired cards. Centralizing the storage of these tokens can also simplify PCI compliance.

Share additional data with issuers

In regions where it’s not mandatory, sharing extra transaction data with issuers can help reduce declines. Providing comprehensive information about each transaction allows issuers to better verify its legitimacy, increasing the likelihood of approval. Use dynamic filters based on country, cart, currency value, or custom metadata to personalize this data sharing.

Optimize your merchant category code (MCC)

Regularly review and update your Merchant Category Code (MCC) to ensure it accurately reflects your business type. An accurate MCC helps issuers understand your business better, reducing the risk of declines associated with misclassification.

Use multiple forms of payment to address declines

Support partial authorizations to handle transactions with insufficient funds. Allowing customers to split payments across multiple methods can reduce declines and improve the chances of completing the sale, enhancing customer satisfaction. Implement retry rules and timeout controls for each payment provider to handle failed payments dynamically.

Maintain low fraud and chargeback rates

A high fraud rate, including chargebacks, can severely impact your approval rates. Implement robust fraud prevention measures and closely monitor your chargeback rates. Utilize risk providers and control 3DS (Three-Domain Secure) to enhance security and prevent fraudulent transactions effectively.

Discover the key differences between refunds and chargebacks, and learn how understanding these distinctions can protect your business and improve customer satisfaction. Click here to find out more!

Authenticate transactions when necessary

Implement authentication processes for transactions, especially in regions where it’s required or beneficial. Authentication gives issuers confidence that the transaction is legitimate, leading to higher approval rates. Balance this with the potential for customer dropout during authentication.

Enhance data integrity to avoid declines

Ensure that all mandatory data fields are accurately filled in your transaction requests. Missing or incorrect data can lead to declines. Regularly audit your data submission process to maintain high data integrity and reduce front-end decline failures.

Support digital wallets for higher acceptance rates

Encourage using digital wallets like Apple Pay and Google Pay, which typically have higher acceptance rates due to their strong security measures and two-factor authentication. These methods can significantly improve your approval rates.

Perform validation checks upstream

Conduct validation checks on transactions before sending them for authorization. This can include verifying card details, billing information, and other critical data points to ensure the transaction is legitimate and complete. Early validation helps reduce declines and improves overall approval rates.

Correctly flag recurring transactions

Identify and flag recurring transactions correctly during the initial authorization request. Recurring transactions are often seen as lower risk by issuers, leading to higher approval rates. Ensure your data elements correctly indicate recurring transactions to benefit from this perception.

Use intelligent payment routing

Implement a payment orchestration layer to intelligently route transactions through the payment networks that offer the highest approval rates and lowest fees. This smart routing maximizes revenue and minimizes costs, enhancing your overall approval performance. Build workflows for optimal approval rates and transaction costs using no-code rules engines.

Provide clear decline messages

When transactions are declined, display clear and informative messages to customers. This helps them understand why the transaction failed and what steps they can take to resolve the issue. Providing actionable feedback can improve customer satisfaction and encourage retry attempts.

Audit and update stored cardholder data

Regularly audit your stored cardholder data to remove outdated information. Contact customers to update their card details if no approvals are available for a specified period. Keeping your database clean and current prevents declines due to outdated card information. Utilize cloud vault solutions to manage and update card data securely.

Implementing these 15 strategies can significantly enhance your approval rates, ensuring smoother transactions and happier customers.

Payment Acceptance Rate: An Updated Guide for 2024 – Stay ahead of the curve with our comprehensive guide on payment acceptance rates. Learn the latest strategies to maximize approvals and enhance your business performance. Click here to read more!

Frequently Asked Questions

How to improve approval rate?

To improve your approval rate, implement fraud screening before authorization, keep card information current, leverage network tokens, share additional data with issuers, and use intelligent payment routing. These are key steps to ensuring accurate data and reducing fraudulent transactions.

How to improve the authorization rate

Improving your authorization rate involves enhancing data integrity, supporting digital wallets, performing validation checks upstream, correctly flagging recurring transactions, and providing clear decline messages. Authentication processes and maintaining low fraud rates also play crucial roles.

What is the authorization rate?

The authorization rate is the percentage of payment transactions approved by the issuer compared to the total number of transactions submitted for authorization. It reflects how often payments are successfully processed without being declined.

How to improve payment success rate?

To improve your payment success rate, use multiple forms of payment, maintain low fraud and chargeback rates, ensure data integrity, implement pre-authorization validation checks, and support digital wallets. Additionally, updating stored cardholder data and using intelligent payment routing can enhance success rates.

Optimizing your approval rate is vital for maintaining seamless transactions and satisfied customers. Implementing the strategies outlined above can significantly enhance your approval rates, ensuring smoother operations and increased customer loyalty. By leveraging modern payment orchestration techniques, you can customize your checkout process, reduce transaction declines, and provide a better payment experience for your customers.

Easily build workflows for optimal approval rates and transaction costs by routing card payments to any payment processor based on card type, bin ranges, amount, or custom metadata you provide. This flexibility allows for an unlimited number of combination choices to customize your checkout process. Prevent failed payments by dynamically creating retry rules and timeout controls for each payment provider, all without writing any code. Ready to take your approval rates to the next level? Contact Gr4vy to learn how you can streamline your payment processes, reduce transaction costs, and enhance customer satisfaction with our advanced payment orchestration solutions. Book a demo now and see how Gr4vy can help you achieve your goals.