15 Ways to Improve Credit Card Acceptance Rates and Your Bottom Line.

Minimise False Declines for Significant Gains

Many businesses focus on reducing cart abandonment or optimising site performance to increase revenue, but these strategies don’t always guarantee sales. Enhancing credit card acceptance rates (also referred to as Authorisation or “auth” rates) ,  has a direct impact on your bottom line. False declines mean lost sales after a customer has already attempted to make a purchase. Every incremental improvement brings in new revenue that was previously lost.

On average, every declined transaction costs merchants $6.50 in lost revenue, fees, and labour. Depending on your industry and pricing, this number could be much higher. Typical issuers decline one in every ten ecommerce dollars during payment authorisation, with 70% of these declines affecting customers who are qualified to make the purchase.

Improving credit card acceptance rates combats credit card declines and leads to substantial revenue growth, higher sales, and increased customer satisfaction. This makes it a straightforward strategy for improving financial performance.

Keep reading to learn how to minimise false declines and improve authorisation rates.

Understanding Authorisation Rates

Authorisation rates, or credit card acceptance rates, are important metrics for any business that processes payments. These rates indicate the likelihood of a transaction being approved by the card issuer. Frequent declines could signal issues with your payment service provider, payment setup, and/or customer experience. 62% of customers who experience a failed transaction will blame the merchant rather than their bank or card issuer. That’s why it’s important to monitor these rates closely.

Other Benefits of Improving Credit Card Auth Rates

• Larger Transactions: Customers tend to spend more when using credit cards, large transaction amounts can increase the risk of false declines and make it imperative to work with a reliable, local card acquirer with top-tier authorization rates.
• Subscription Business Impact: For subscription-based businesses, a 1% improvement in authorisation rates can translate to a 12% increase in annual recurring revenue over a customer’s lifetime
• Customer Satisfaction & Loyalty: When customers experience frictionless transactions, they develop greater trust in the merchant and are more likely to become repeat customers. 

15 Ways to Optimise Credit Card Acceptance Rates

Here is your 15-point checklist for improving credit card acceptance:

1. Partner with Local Card Acquirers: Collaborating with local card acquirers who understand the nuances of your specific market significantly increases authorisation success. These acquirers often have better relationships with local issuers and their knowledge of regional regulations and consumer behaviour, allows for more accurate transaction assessments and approvals. Benefits include:

• Established relationships with local issuers
• Transactions in native currency
• Reduced cross-border charges
• Compliance with local regulations
• Faster processing times

Rapyd is an example of a local card acquirer who is directly licensed with Visa and Mastercard across Europe, the UK and Singapore. Through Rapyd’s tailored solutions, many merchants across industries can accept credit and debit cards worldwide with higher acceptance rates, improved uptime and 24/7 dedicated support.

2. Adopt a Multi-Acquirer Strategy: Integrate multiple acquirers, such as Rapyd, to improve authorisation rates. Orchestrating multiple PSPs enables merchants to route transactions through the best processor for each payment, increasing approval rates and reducing costs. It also ensures continuous payment processing by providing redundancy during downtime or technical issues. Payment orchestration platforms are a popular option for managing multiple acquires.
3. Use Instructive Decline Messages: Implement clear, instructive error messages, that prompt the customer to check their card information and try again. Many card transactions are declined due to temporary network issues, or user error. Merchants can recover up to 30% of declined transactions by using instructive messaging that helps customers correct errors and rety transactions, thus improving recovery rates. 

Example decline messages 

• Payment validation failed: Processor declined. 
• For security reasons, please re-enter your credit card information. 
• Tip: You may try a different card or an alternative payment method.
  

4. Offer Manual Input at Point-of-Sale: Offer manual card input options at points of sale to cater to situations where microchips or magnetic strips might be damaged, ensuring that transactions can still proceed.
5. Utilise Account Updater Services: Updating card information regularly helps minimise declined payments caused by lost, stolen, or expired cards. Utilise services such as Visa Account Updater or Mastercard Automatic Billing Updater. Although there is typically a fee for these updates, the reduction in declined transactions, operational expenses as well as and increased customer retention often justify the financial expenses.
6. Employ Enhanced Fraud Monitoring: Use configurable fraud rules tailored to your business model and customer profiles to minimise false declines while maintaining security. False declines due to unoptimised fraud prevention measures can account for up to 3% of a merchant’s annual revenue. Automated transaction monitoring reduces the need for manual transaction reviews, preventing delays and decreasing the likelihood of declines.
7. User-Fiendly Checkout Processes: Ensure your checkout process is intuitive and straightforward, minimising the chance of errors and abandoned transactions. Some tips to keep in mind: 

• Offer guest checkout: Allowing customers to complete purchases without creating an account can streamline the checkout process and reduce friction.
• Display all fees and pricing: Clearly displaying all applicable taxes, fees, and the final total amount due can help set customer expectations and reduce the likelihood of declined transactions due to insufficient funds.
• Provide localised checkout: Using a processor that localises languages, currencies and payment methods helps eliminate confusion and friction in the buying experience, supporting accurate data input and buyer confidence.
  

8. Strengthen Acquirer Relationships: Develop strong relationships with your card acquirers to facilitate better support and improved authorisation rates. Acquires can provide more tailored risk management based on a merchant’s specific bussiness model, industry and customer base, leading to higher approvals on legitimate transactions.
9. Use Intelligent Retry Logic: Integrate smart retry mechanisms that reattempt processing transactions multiple times before issuing a final decline, boosting approval rates. These systems retry declined transactions at optimal times, using customised strategies based on factors such as the type of decline (soft vs. hard), transaction history, and customer behaviour. Be sure to remain compliant with card network retry limits (e.g., 4-6 retries within 15 days).
10. Implement Tokenisation: A Visa report indicates a 2.1% increase in authorisation rates with tokenisation. This method secures card data by using tokens instead of card numbers, enhancing security and compliance. Tokens are automatically updated for expired or reissued cards, providing issuers with reliable payment information for accurate authorisations.
11. Keep Business Information Current: Regularly update your business and billing information to prevent discrepancies that could lead to declines. Ensure your business has the correct Merchant Category Code (MCC) to help card issuers categorise transactions properly, reducing declines due to mismatched business-type expectations. Other information to keep up to date that strengthens reputation with issuers: 

• Correct legal business name
• Updated contact information
• Proper business address
• Current website URL
• Accurate Tax ID or EIN
• Updated business description 
• Accurate processing volume projections
  

12. Monitor and Analyse Declines: Merchants should familiarise themselves with the credit card decline codes. Then, regularly track and analyse decline reasons to improve future authorisation rates. Identifying patterns in false declines helps refine fraud detection rules and adjust risk thresholds, allowing more legitimate transactions. Categorise credit card decline codes (e.g., AVS mismatch, unusual activity) to develop targeted strategies and enhance customer communication. Merchants can also tailor strategies based on customer segments, product types, or geographic regions for better authorisation rates.
13. Optimise for Mobile Users: Mobile authorisation rates are often 3-5% lower than desktop rates. As more users shift to mobile transactions, ensure your mobile checkout is user-friendly and responsive. Mobile-optimized sites load faster, reducing timeouts that cause authorisation failures. Features like auto-fill, numeric keypads for card numbers, and clear input fields minimise user errors and declined transactions. Additionally, integration with mobile wallets like Apple Pay or Google Pay can boost authorisation rates due to enhanced security.
14. Leverage Pre-Authorisations: Preauthorize transactions to reduce declines from insufficient funds, spending limits, or other issues. This process verifies customer and payment information in advance, minimising errors and adding an extra layer of fraud security.
15. Offer Multiple Payment Methods: While improving credit card acceptance rates is important, merchants should also prioritise improving successful transactions overall. Offer multiple payment options, such as digital wallets and other alternative methods, to cater to diverse customer preferences and reduce reliance on credit cards. This approach broadens customer reach, accommodating different segments and increasing the likelihood of completed transactions. 

Improvements Your Bottom Line Will Love

How would your business benefit from minimizing false declines and securing more repeat customers? Improving your credit card acceptance rates with just one or all of these 15 strategies will lead to significant revenue growth and enhanced customer satisfaction. Rapyd, a global payments provider, helps merchants excel at integrating these strategies, ensuring businesses experience higher approval rates, fewer declines, and overall improved payment processing and revenue efficiency.