Category: APPROVAL RATE

  • How US-based Websites Can Accept Credit Card Payments in Europe

    How US-based Websites Can Accept Credit Card Payments in Europe

    Gaining traction in the European market is essential for the growth of any global brand. Having a credit card payments processor that accepts international payments is a fundamental asset for your online business. Between local currencies, foreign transaction fees, and exchange rates, there are several aspects of which your e-commerce store needs to maintain awareness all times. And this is only after you’ve found a payment service that accepts global payments without breaching service agreements.

    Here, we will outline what you need to operate as a US retailer in Europe successfully, helping you scale your large, medium, or small business across the globe to unprecedented levels of success.

    Accepting Credit Card Payments in Local European Currencies

    Customers in Europe, just like those in the US, are seeking convenience when making online purchases. Credit cards are a convenient option for consumers across the world, giving them the freedom to make purchases anywhere Visa,  MasterCard, Discover, and American Express (or whatever local card they may hold) is accepted. US-based online storefronts accept these payment methods but often only display USD, no EUR.

    This discrepancy may deter some but not all. The bigger issue is the fees that are charged to the customer when making their purchase. Their issuing bank will likely charge an international transaction fee and use a relatively high currency conversion rate. This could lead to cancellations, chargebacks, and a significant decrease in international sales.

    Often enough, consumers want to avoid these two extra charges, but there are very few ways to do so. Many times, they will leave your store to find the same or similar product sold in their own currency elsewhere. What can you do about it?

    Use a Processor That Works in Europe, Locally or Internationally

    Using an online payment processing service that accepts local currencies, or euros at the very least, will keep consumers on your site and your profits rising. Luckily, the euro is fairly universal for the European continent, so it’s a great first step to getting your foot in the door. You’ll need a credit card processor that accepts local currencies in Europe with exchange rate and transaction rates that don’t hurt your bottom line.

    PayPal is often used for international purchases and sales as it makes online transactions easy on both ends. However, there are noticeable downsides to using PayPal in multiple markets. For consumers, the exchange rate is incredibly high. When consumers see this, they may be deterred from making purchases from you now and in the future. For businesses, especially high-risk businesses, PayPal charges insanely high fees and can refuse service altogether. There are better ways to accept payments that keep costs down without downgrading the experience and protecting yourself against chargebacks.

    For businesses whose sales volume exceeds $100K per month in an international region, it might be worth considering opening a local EU operation. Credit card issuers and local banks in European countries convert transactions better than international bank accounts, so operating locally would reduce fees and increase conversions.

    On the other hand, if volume is lower, then you can speak with your current provider about installing a simple plugin that allows for cross-border payments or dynamic currency conversion similar to the service offered by Paypal or Stripe. This would also avoid exchange rates from various currencies to your local currency USD.

    Companies like DirectPayNet use international connections and payment processors to allow your business to accept international credit card payments with low fees and without opening additional e-commerce storefronts.

    Utilize Methods to Ensure Brand Presence in Europe

    Using a checkout system that accepts international or local currency credit card transactions is not the only hurdle when operating a US-based business outside the continent. Other methods that ensure your presence and profitability in other markets involve changes to your website as well as acceptance of alternative payment methods. For example, in Germany, SEPA payments are quite popular whereas Spain and the United Kingdom have several debit card options that are widely used.

    Find Your Audience

    The customers you have in the US or North America may not behave the same way as those in Europe. Do some audience research and find the demographics—especially location-wise—that your brand appeals to most.

    The first benefit is expected: you’ll make more sales because you can target potential customers better increasing your market share. Understanding your audience is one of the most indispensable advantages of owning a business that deeply affects each department within your company. From marketing and design to pricing and payment methods.

    The second benefit is using that data to operate in a specific market within the European Continent. When you know that you have a large following or high potential in Germany and The Netherlands but very little in Iceland and Spain, then you can use that information towards location-specific credit card acceptance. Whether that means partnering with a payment service from that region using one that accepts the region’s local currency, audience data will boost scalability.

    Translate your Website

    Though English is a universal language, it may not be the best language to use to penetrate a local European market. That’s especially true if you are planning to operate in a specific European country or region. In that case, you will want to have your website translated.

    A translated website increases conversions. You don’t appear as a foreign entity to the locals, instead you appear as a company with global reach and regional understanding. Your website resonates better when it’s written in the language spoken by the people using it.

    It also helps you avoid any confusion with terms of service, product descriptions, refund policies, and more. Consumers will understand your brand better if they can experience it in their native tongue.

    Allow Other Payment Methods

    When first tapping into markets in Europe, credit cards should be your priority. But don’t assume that it’s a widely used format or that cardholders are within your target audience. Research shows that credit cards are not always the most widely used method for making payments across the continent. Many European customers still prefer to use cash when possible. We understand that type of payment is not possible when running an online-only store, but the information is still insightful as to what types of payments you should accept or prioritize. You may consider COD (Cash-on-Demand) when possible

    If your store will operate in several countries across Europe, then focus on credit cards: using local banks if possible, asking your merchant account representative to investigate partner banks with lower fees, and accepting local currencies on your payment gateway. If you are planning to operate in just one or two European countries, then research which payment types are used most often. You may want to allow credit cards as a solid backup payment solution but focus more on bank transfers (via SEPA), debit cards, direct debits, wire transfers, or e-wallets.

    Merchant Accounts Allow Your Business to Scale in Europe while Staying Secure and Accepting Local Currencies with a Focus on Your Bottom Line

    Your bottom line is what matters. Using a payment method that has minimal fees while maximizing positive impact on your bottom line is the best way to scale in a new market. DirectPayNet works directly with several banks to allow international sales. We can help you set up locally within the EU as well as ensure functionality with local currencies on your US-based site. This minimizes processing and currency exchange fees for both you and your customer. We achieve this through our highly secure payment gateway that’s designed for ease-of-use on the consumer-side and alteration on the developer side, so you can add and remove currencies as you need.

    Contact our expert team of customer service representatives today and we’ll get you set up with a payment gateway that accepts all major credit cards, currencies, and payment types. Scale your business and prove your global authority with DirectPayNet.

  • FAQ Fridays: Your Merchant Category Code Can Increase Your Sales

    FAQ Fridays: Your Merchant Category Code Can Increase Your Sales

    A regular query I get from prospects and new clients, like this one from Paul K., who runs a supplement shop that’s been scaling considerably in the last few months:

    “Maria, I’ve signed up with a new payment processor – and they asked me what Merchant Category Code (MCC) my business is. What’s this all about, is it important?”

    Short answer: Yes! 

    The Merchant Category Code – I’ll refer to it by the acronym MCC for the rest of this explanation – is important for your business.

    You need to make sure you are in the right MCC classification to keep your costs and decline rates down.

    Here’s some more detail:

    Most recently, the question about MCC came from Paul K., a merchant selling supplements on a subscription model – 

    His products included a range of nutraceuticals, a protein powder, and also some e-books on fitness and health topics as upsells.

    Paul never even knew the MCC existed until they switched accounts and the new payment processor asked them about it.

    What he noticed – 20% of his transactions declining on the front-end.

    And Here’s What I Told Paul:

    “Dear Paul,

    The merchant category code that your payment processor assigns to your business has several impacts on your transaction fees and approval rates.

    If you’re a nutraceutical merchant selling supplements on a monthly subscription, you may be categorized differently depending on the processor you work with – 

    • One processor may decide to place you in the MCC 5968 for Direct Response businesses offering a subscription model.
    • Another processor might make the case that you are in MCC 5499 because you sell supplements, protein powders and other food type items. 
    • If you sell a lot of e-books or info products, MCC 5999 (miscellaneous retail) might apply…
    • And for digital media sellers – MCC 5815 could be the best option.

    Important things to note:

    • Your merchant account fees will vary depending on MCC
    • Your approval rate can also vary – that’s because your customers’ bank may have restrictions placed on certain MCCs
    • Credit card rewards, debit cards and prepaid cards all carry a different cost mainly because of the benefits offered to the consumer
    • American Express typically charges the most as they offer a lot of benefits to their members

    If you have more questions and want my input on the best MCC selection for your business – let’s schedule a call to discuss it further.

    Maria Sparagis

    Of course, I was trying to keep things simple so the email didn’t confuse Paul and his team too much…

    As always with payments, there are several more layers of detail and complexity.

    Let me explain…

    Your Merchant Account Fees, & Discount Rates

    First – a definition:

    Interchange is the fee that the card networks like Visa and Mastercard charge for processing a transaction.  

    Some payment processors charge an interchange plus fee (also called a cost plus fee) for your merchant account.  

    The cost of interchange varies depending on your MCC and the card type your customers are using.  

    For example: 

    For a debit card transaction, selling a supplement subscription using MCC 5968 (direct response merchants) will have a much lower fee than MCC 5499 (supplements, protein powders and other food type items) for that same debit card.

    Interchange fees are ALSO what allow Visa, Mastercard, Discover and American Express to offer high credit card rewards.

    The credit card companies fund the rewards to their customers from the fees a merchant pays for processing that credit card.

    Some payment processors charge a flat fee – for example, payment providers such as PayPal or Stripe have flat fee pricing with an additional fee for foreign or corporate cards. This means interchange fees are not important for merchants on these platforms.

    Other payment processors charge a 3 tiered discount rate – this means they categorize the cards your customers pay with into 3 ‘buckets’, and charge a specific price depending on which ‘bucket’ the customer’s card is in. Again, in this case, interchange fees are less important for your business.

    Overall, selecting interchange-plus/cost-plus pricing is the best option because you will know how much you are paying per card and what the markup is for your processor. 

    Typically, interchange-plus/cost-plus saves you money on your merchant account fees. 

    Most merchants prefer the lower fees for interchange-plus/cost-plus, but some merchants need the certainty of a flat fee so they can easily reconcile and forecast merchant account fees at the end of the month – and they are prepared to pay what are usually higher fees for a ‘sure thing’.

    (The choice is similar to a variable rate vs a fixed rate mortgage loan. Variable almost always comes back as the lower cost option – but some people prefer the certainty of a fixed rate so they can make a repayment plan without worrying about interest rates)

    So Why Not Just Choose The MCC With The Lowest Interchange Fees? 

    It’s not that simple. 

    Your merchant services provider cannot just assign you any merchant category code you choose…

    They have their own compliance procedures, and your MCC needs to make logical sense depending on the type of product or service you’re selling. 

    That being said – your business may fit into several MCCs.

    At first glance, the obvious choice seems to be – choose the Merchant Category Code(MCC) with the lowest interchange cost!

    Not so fast…

    If you’re in a high-risk industry, you may be better served by a MCC that is not considered high-risk – even if the fees are higher. 

    Some Direct Marketing merchants accept higher interchange rates to get a MCC that is lower-risk to try and get better approval rates.

    There’s also the credit card companies procedures – Visa and Mastercard come up with different operating rules for specific MCCs – and your payment processor must comply with them.

    The many and varied rules and policies between credit card companies and different payment processors can impact your business in unexpected ways…

    And if your business model changes, you may need to change your MCC, and also change the way you charge your customers.

    For example, Visa added new rules to MCC 5968 for free trial or discounted subscription merchants in April 2020 (implementation delayed due to COVID-19).  

    These new rules govern merchants’ abilities to charge a subscription fee without the customer’s explicit consent [LINK – Details Here]

    Working with a specialist payment processing consultant can save your company a lot of time, money and headaches.

    Contact the DirectPayNet team to review the merchant fees you’re paying – and find out if you can get a more cost-effective credit card processing system for your e-commerce business.

    We specialize in helping high-risk businesses overcome the obstacles of higher than required merchant fees.

    Your Transaction Approval Ratios May Be Higher With A Different MCC

    Some issuing banks have limitations or “scrubbing” set up for merchants of a particular MCC

    The reason for this is because some merchant category codes generate more chargebacks and fraud than others.

    So for example, your customers’ bank may have a limit on the amount a transaction can be if it comes from a MCC 5968 merchant.

    So there are some ‘tricks of the trade’ to help reduce these problems:

    Testing different price points with the different merchant accounts is very important to understand how you can maximize your conversions. Many direct marketing merchants increase checkout conversion rates substantially by lowering their AOV to under $100.

    Another option is to operate 2 payment gateways, with each account registered under a different MCC – so you can capture any declines that come back as an issuing bank decline, and then try run them through the second gateway with a different MCC.

    Many issuer bank declines are masked MCC code declines, simply because the customer’s bank doesn’t want to take the risk.

    For example, an MCC 5967 purchase means the customer is buying adult entertainment. That doesn’t fit the risk profile for many financial institutions.

    Some payment gateways and SaaS companies offer merchants an option to ‘cascade’ front-end transactions to different merchant accounts to try to capture the sale. 

    This ‘cascade’ feature checks multiple merchant accounts in real time to see which one will process the transaction – and is totally invisible to the buyer/customer – adding significant sales dollars to your front-end funnel.

    Couple that feature with multiple merchant accounts in different MCCs and you can significantly reduce decline rates.

    One word of warning though – select a PCI compliant payment gateway or software to reduce the risk of data breaches when passing customer data from one merchant account to another.

    Contact DirectPayNet to learn about payment gateway options that offer conversion boosting features for your funnel and subscriptions.

    Your MCC Can Affect Your Chargeback Ratio

    Your customer’s credit card statement will tell your customer what kind of purchase was made by providing a brief description, such as ‘SUBSCRIPTION PRODUCT’.  

    American Express makes it very obvious on the statement – 

    If a customer sees ‘SUBSCRIPTION PRODUCT’ and is running low on funds, they may choose to cancel or even send you a chargeback. 

    VISA and Mastercard also have different rules for how a customer can chargeback a transaction –

    Some merchant category codes allow issuing banks to chargeback a transaction more easily than others – a grocery store purchase will be a lot harder to chargeback than a nutraceutical product on a monthly subscription.

    Credit card companies’ rules are there to protect customers against what they decide are “shadier” businesses or products. 

    Drug stores, government services and other mainstream retailers like clothing stores typically benefit from lower interchange fees as well as lower potential chargeback ratios due to their MCC.

    Paying attention to the MCC you’re assigned when you start working with a new merchant services provider is very important – it can impact your merchant fees as well as your transaction approval rate. 

    To understand more about merchant category codes and how they impact your conversions, talk to the experts at DirectPayNet

    We can guide you in selecting a MCC, and walk you through ways to improve your conversion ratio and lower your merchant fees.  Contact DirectPayNet today.

     

  • FAQ Fridays: How Do I Reduce Credit Card Declines At My Checkout Page?

    FAQ Fridays: How Do I Reduce Credit Card Declines At My Checkout Page?

    Q: I have too many credit card declines in my online business. Since 2019 I’ve been operating an online electronics store. I do pretty good numbers – about €150K a month and 1.12% chargebacks. But with the holiday shopping season coming, I need to fix this pesky problem fast!

    Last year my store had about 63% approval rate on our customers checking out from my cart. This year has been putrid. My business is now trending 54% approvals and so far for October the numbers keep getting worse. Most of the reasons are “issuing bank decline” and “insufficient funds”, then there’s others like “transaction not permitted”.

    Can you provide additional insight so I can help my electronics store approve more orders and reduce my credit card declines?

     

    A: Thanks for your question. There are a variety of reasons credit card declines happen at a checkout. It really depends on a few factors.

    Let me first explain the meaning behind those decline messages. The “issuing bank decline” is a common reason seen by online merchants accepting credit cards. It’s a vague response, but essentially the customer’s credit card issuer is telling you that they are not allowing the transaction.

    Visa or Mastercard, or the customer’s bank could be limiting large purchase amounts (for example, selling a drone for €1050). Or, the purchase doesn’t fit the customers regular buying habits. As a result, the order is declined. Therefore, transactions over certain limit may be deemed suspicious by the cardholder’s bank and blocked.

    The bottlenecks could also be because your customer’s bank is preventing orders from your merchant category code (MCC). The electronics category is known for being high risk so some banks are cautious to approve orders from this type of business. In any case, you may want to advise your customers to call their bank or credit card company to permit the transaction. Also, ensure you charge in USD if your merchant account is in Europe but you’re selling to Americans. This helps bypass currency exchanges.

    Electronics store owner learns ways to lower the instances of credit card declines at checkout

    You may benefit from having a second payment processor. An additional gateway allows you to “cascade” declined transactions. Therefore, a backup solution to ensure there are no bottlenecks and to try to recoup some of your issuing bank declines can actually help increase your conversions at checkout.

    The message “insufficient funds” is one of a few obvious reasons for credit card declines (along with “expired card number”). It’s also a popular reason for especially now during the Coronavirus pandemic. Spending habits have changed significantly. Many people are low on available credit because they’re in debt and out of work. Things are so bad for some consumers that they are unable to make their minimum payments.

    Want to see more credit card decline code explanations? Check out our blog “Monetize Your Traffic! Understand Transaction Decline Codes & Raise Revenue By 10%” parts 1 and 2.

    Unfortunately, the consumer must make a credit card payment for a more reasonable credit utilization ratio. Or, they can ask their issuer for a credit limit increase. Until then merchants like yourself will have to find other ways to collect payment. As an example, some merchants are allowing their customers to pay in instalments and charging the card number for smaller dollar amounts.

     

    Cross-border sales create friction

    Since you’re in Europe we’re assuming that’s a sizeable part of your target audience. However, if you’re selling to other countries outside your region, that could be why you’re seeing more declines. It is harder for Europe-based bank to approve credit card sales from outside the EU (especially the US and Canada). International debit card transactions have an even poorer success rate. That’s because typically, customer’s bank only approves local transactions on debit.

    Unfortunately, there’s a lot of friction between the technological infrastructure of EU banks and financial institutions from other regions around the world. This creates problems for merchants like yourself. Your sales will still see more declines even when the authorized user has entered all the correct billing address and other card information, like the CVV on the back of card.

     

    Recommendations to reduce credit card declines

    The following are recommendations we often make to our clients with high credit card declines which result in lower approval ratios. Hopefully they will be of use to your electronics store.

    First pull a report and sort all declined transactions from the last 90 days in a spreadsheet to identify the most popular reasons. Next, you can start to apply a remediation plan for each decline reason. For example, if insufficient funds accounts for 25% of declined orders, you might want to offer payments by instalments. Or, attempt to rebill the prospective customer within 5 days in case more is credit available sooner than a month later.

    In the case of issuing bank decline reason, it’s best to engage potential buyers during the sales journey. The last thing you want is for them to abandon your shopping cart at the final decision stage. If possible, include a customer support phone number, link to an FAQ, add disclaimer or use intuitive responses during the sales journey for why a new credit card order was rejected.

    This is a chance for you to let them know they can easily make a phone call to their bank to permit the credit card transaction. Or, perhaps they need to be alerted that their card has an old expiration date and needs to be replaced.

    More than anything, make sure that your electronics e-commerce site is secure. A potential buyer should feel comfortable knowing they’re putting sensitive card details and contact information with a trustworthy vendor. We advise all merchants to be PCI compliant and you should do the same. Make sure SSL certificates are up to date. Put trust symbols on your order page to ease buyers’ concerns about security. And, if possible, encourage visitors to create an online account before they purchase so security is at the forefront. Don’t forget to make strong passwords and 2-factor verification mandatory to curb identity theft incidents.

    We hope these strategies work for your online electronic store. If you need more insight, feel free to reach our support team.

    Do you have a question for our FAQ Fridays segment? Email DirectPayNet and let us know how we can help you avoid mistakes. Send your question to our team here.

     

    • Transaction Approval Rate: Make More Money In 30 Days

      Transaction Approval Rate: Make More Money In 30 Days

      Would you like to know how to increase your transaction approval rate to earn more revenue in 30 days or less?

      Think about it.

      If you’re generating $20,000 in sales each month right now but have hundreds of declined transactions, you could be missing out on thousands of dollars from people who want to buy your product or service.

      You could finally say goodbye to rejected transactions. No hassles. No customers would think you’re a scam. Losing sales you’ve paid dearly in traffic to get would diminish every day.

      The truth is, many high-risk merchants get charged a fee for each declined transaction.

      You could raise your revenue by 10% or more by reducing declined transactions.

      If you can relate to any of this…

      We’re here to tell you it’s possible to increase your profit margins within 30 days or less.

      So, if this piques your interest, keep reading to find out how you can improve your transaction approval rate and make this your most profitable year yet.

       

      What is a transaction approval rate?

      You might hear other people refer to the transaction approval rate as transaction success rate (TSR).

      Either way, you can get both by calculating:

       

      TOTAL # OF APPROVED TRANSACTIONS


      TOTAL # OF ATTEMPTED TRANSACTIONS

       

      Here’s an example…

      If you process 1000 transactions and only 750 of them turn into sales, your transaction success rate is 75%.

      Now, imagine if those 1000 transactions are worth up to a total of $75,000 in sales. That means you are losing $18,750.

      In fact, you’ll be earning less than that.

      Your payment providers deduct fees from your payment gateway and merchant account. This includes a cost for each declined transaction which could range anywhere from $0.20 to $2.50 per charge attempt.

      How would that make you feel?

      That’s why it’s important to see how much money you are losing. If you use the transaction approval rate to measure your success, it’ll be easier for you to test and optimize your payment processing.

      Why the transaction success rate matters
      It’s frustrating when potential customers change their minds about buying after their card gets declined. (Photo by Yan from Pexels)

       

      Why the transaction success rate matters

      This metric is crucial because it highlights how much money you’re losing after spending a lot to acquire a customer.

      It’s frustrating when potential customers change their minds about buying after their card gets declined. And we know you might be thinking that there isn’t much you can do afterward…

      But you can always find the root of the problem and prevent it from happening again.

      There are multiple reasons a transaction gets declined. Sometimes the cardholder doesn’t have enough funds in their bank. And, that’s not your fault. Or, it’s possible that the transaction was rejected by the customers’ bank with little reason provided. Or, your buyer is in a different country using a card type not recognized by your payment provider.

      If that’s the case, perform a sales audit. Look at the history of each lost sale and find out why they were declined.

      Tracking this crucial data, will improve your chances of increasing your sales from your existing traffic. Also, you’ll save yourself from getting charged more merchant account fees for declined sales.

       

      The surprising risks of payment processing

      As you’re aware, mom and pop stores offline prefer customers pay with cash instead of a debit or credit card. This is because they want to avoid transaction fees. E-Commerce merchants don’t have this luxury.

      Being an online seller means you cannot escape fees when a transaction happens regardless of whether it’s approved or declined, or even if it’s not your fault. By paying for a declined transaction, it’s a straight up loss.

      What’s worse is that in the e-commerce world, chargebacks happen. The burden of paying for them falls on the merchant. Not only do you pay for declines, but you also lose if the customers issues a chargeback or refund.

      According to Mastercard, “The [card-not-present] CNP channels are disproportionately impacted by false declines, with the average decline rate for a CNP transaction hovering around 15% to 20%, versus 2% to 3% for card-present transactions.”

      These rates will vary, but there could be other penalty fees that add up too.

       

      Too many chargebacks negatively affect merchant accounts

      Excessive chargebacks, for example, have an impact on costs to operate an online business. When a customer has a complaint about the merchant or their product, they could call their bank to dispute a transaction. Then, the bank will initiate a chargeback to refund the customer’s money along with a fee whether or not a refund has already been issued by the vendor.

      A high enough rate of chargebacks could result in getting MATCH-listed or TMF’d by the payment processor. It’s never fun when something like this happens.

      As you can see, there are some risks involved by having your own merchant account.

      To get your account to a low risk level, you’ll need to partner with experts in high-risk merchant accounts.

       

      DirectPayNet is not your average merchant service provider. Secure a robust payment gateway and get help managing your payments channel. Connect with us today.

       

      Why orders get declined

      Even if you have a high-risk merchant account, you can still drive a higher transaction approval rate than anyone else in your industry.

      We’ve seen high-risk categories, such as the supplements, financial and dating industry, achieve this.

      These are some of the most common factors for a high decline rate:

      • Card Type Rejected
      • Cardholder’s Address does not match
      • “Do Not Honor” Declines
      • Expired cards
      • Fraud/Risk Mitigation Tools
      • Large Ticket Orders
      • Incorrect Account Information
      • Insufficient funds
      • International Charges or Currency Does Not Match
      • Technical Issues

       

      Pay attention to the merchant category code

      The merchant category code (MCC) is for credit card networks to identify the type of services the business offers.

      This 4-digit number is used to track purchases and maximize credit card rewards. For example, your transaction description may show up as “grocery stores” after buying food at your local market.

      The MCC could even prevent certain purchases like an unusual, large volume of orders. Because of this, it becomes a barrier to get more orders approved.

      Finally, MCCs are associated with your business model. Merchants with online businesses in the gambling, gaming, supplements and adult entertainment market can’t escape this label.

      Unfortunately, when some banks see your MCC, they automatically reject your orders. This is because some categories are rampant with fraud. Having a lower ticket for your product will result in more sales as banks see a low price as less risk for potential losses. Split test pricing to see where you get highest conversion while balancing chargebacks and refunds.

       

      High-level solutions for high-risk merchants

      Now that you know what affects a transaction approval rate, it’s time we go over some solutions that every merchant should apply.

      There are tons of concrete solutions. But today, we’re only going over these three:

      1. Payment Method Selection

      Something as simple as displaying specific credit card logos can increase your total of approved transactions. Display the most updated Visa, Mastercard, American Express and Discover symbols in your footer and on your checkout page. This will show potential shoppers what card types you accept.

      Don’t forget to include brands like Maestro. You should publish a disclaimer notifying your visitors that debit purchases from outside of your country are not accepted.

      Unfortunately, EU banks will only approve EU debit transactions. The same goes for US banks only recognizing US debit purchases done locally. But, make this clear at your checkout. That way, customers will know whether you allow debit transactions and you will not be charged a fee because their attempt got declined.

      If you want to improve your cross-border transaction approval rates, explore adding various currencies to your checkout page. Your sales conversions will increase if you charge the customer’s card in the same currency it is issued in.

       

      2. Manage Update Notifications

      Your customers’ credit card information might need to be updated from time to time. Their subscription renewal is coming soon, but are their card details still accurate?

      For a successful rebill, you could notify them before the next charge. Even a simple email might be all that you need to avoid declined transactions.

      Sign up for Visa Account Updater (VAU) and MasterCard Account Updater (MAU). This service updates card details automatically for expired cards or cards that have been replaced. It’s inexpensive and will increase customer lifetime value (CLV).

      Enhance your checkout with an API response. Checkout sessions can be sophisticated if you develop them to respond to different buying scenarios. Telling your customers why their card was declined will help them be successful at their next attempt to buy from you.

       

      3. Implementing 3D-Secure

      By now you’re probably already familiar with how 3D-secure (3DS) works. If you’ve been asked to complete additional verification when shopping online this is it. As you’re aware, this is what’s known as a secure pop-up registering more data. Some newer 3DS providers are able to authenticate the transaction without any friction to the customer.

      A strong customer authentication (SCA) often relies on 3DS. This is so that the buyer can voluntarily authenticate their order and minimize any challenges during checkout.

      It’s a great way for merchants to offer a better and safer user experience for their customers. Best of all, merchants have an easier time being protected from chargebacks when 3DS is used.

      Soon enough, we’ll start to see 3DS become mandatory for merchant accounts over the course of 2020 and 2021 for European merchants and will likely follow in the US. So implement this now, because it will inevitably be the standard for all online offers sold.

       

      Increase your transaction approval rate today

      There’s an untold truth about high-risk merchants with big traffic…

      You could be increasing their earning potential by 10% or more in 30 days or less.

      The online businesses of many entrepreneurs is suffering from low transaction approval ratios. Thorough analysis is needed to correct and reduce declined orders.

      On top of that, merchants keep getting charged for every declined transaction. And most are unaware of how they can improve their payment processing.

      With better communication, a few effective tweaks to the checkout page, and more diversified banking to cater to different card types, merchants can see profits and sales soar. They will no longer have to worry as much about handling the hassles of getting transactions declined.

      So in reality, all you need is a payment gateway provider you can trust. And, if you’re looking to grow your sales fast, then you can count on these solutions.

      Fixing transaction approval rates is only one of many solutions available for increasing your online revenue. Want to know other tactics plus tips for risk management? Get started by contacting DirectPayNet today!