How Intelligent Transaction Routing Can Boost Your Approval Rates by 5% or More

In the complex world of digital commerce, ensuring every customer payment is processed successfully is paramount to a business's success. Learn how intelligent transaction routing can boost your approval rates, leading to more sales and satisfied customers.

How intelligent payment routing works

Intelligent payment routing is like a GPS for your money, automatically choosing the best path for a transaction to travel. Instead of sending every payment through the same channel, the system analyzes factors such as transaction fees, approval rates, and currency in real-time to pick the most efficient and cost-effective processor. 

This smart decision-making increases the chances of the payment succeeding while lowering costs for the business.

Optimizing for specific transactions

Each payment processor has its strong and weak points, meaning that they do not perform equally for all transactions. Intelligent transaction routing takes this into consideration, analyzing a combination of factors to gauge the best path. These factors include card type, currency, customer location, transaction amount, and historical performance data. When it finds the one that addresses those specific factors most effectively, it sends the payment in that direction.

Reducing false declines

Inevitably, anti-fraud systems make mistakes. When they do, their overzealousness can lead to false payment declinations. Fortunately, intelligent payment routing can avert them with its more sophisticated set of risk analysis tools. Alternatively, it can send the transaction to a secondary location, usually a processor known to have a lower rate of false declines.

Failover and smart retries

There are many instances in which a payment has a soft decline. This means that it has been rejected due to a network outage or temporary system error. In these cases, intelligent routing can send the transaction to a different processor. Best of all, no action is required from the customer. With this “second chance” approach, cases of lost sales are significantly reduced, leading to higher revenue and boosted client satisfaction rates.

Balanced loads

When a single processor becomes inundated with payment requests, the risk of failure and payment declinations is magnified. On the other hand, intelligent payment routing helps to ensure that all payments are handled by companies that are operating at peak performance. Therefore, the risk of rejection is significantly lowered, resulting in smoother funds transfers, fewer frustrations, and a greater likelihood that the sale will go through without a hitch.

With smart routing, transactions can be automatically routed to payment gateways with the highest approvals. This efficiency helps to increase your approval rates. Additionally, overall transaction fees are lowered because payments can be sent to the most cost-effective gateways. In the end, smart payment routing is an efficient, cost-effective, and resilient solution that can foster maximum success through boosted payment approval rates.