10 Simple Tips to Keep a Check on Payment Success Rate
In e-commerce world the “commerce” word is related to Payments and more precisely “digital payments” and when we talk about payments in e-commerce, naturally we start talking about “Payment Success Rate” or “PG Success Rate”. This blog talks about how you should perceive the success rate as well as what all measures we should take care to increase them inch by inch (I mean decimal by decimal points)
This post is for entrepreneurs, product managers, engineers & payment enthusiasts and who have basic knowledge of how Digital Payments work and who are willing to take risks to increase the Payment Success Rate.
During this post I will use “PG” for Payment Gateways and “PG Aggregators” for the processors who aggregates more than one PGs and provides their services to multiple clients/merchants.
Lets understand the below 10 pointers which address this subject :
1. Check the Seamless vs Non-Seamless Integration in your system
Mostly all of the PGs offers seamless and non-seamless integration kit for the integration with merchants but its your choice to go for the PG integration model which suits your website/product.
- Seamless Integration (where payment option is selected at merchant’s site and PG directly takes you to BANK 3D Secure Page)
- Non-Seamless Integration (where payment option is selected at PG end and then PG takes you to BANK 3D Secure Page)
If you have a Large Scale Business and a Dev team for PG Integrations who can integrate multiple PGs for CREDIT/DEBIT and NETBANKING then you should go for SEAMLESS INTEGRATION where the payment options can be designed as per merchant’s choice and the look and feel can be retained as per the flavour of the website.
Small Scale Business or The Startup to use Non-Seamless Integration like PAYU or CCAvenue or BillDesk because in this case merchant website just do one integration with the PG Aggregators and rest is taken care at PG’s end from payment collection to completion. Read more info in my previous blog
2. Use a mix of PG Aggregators and Direct PG integrations
Based on my experience SEAMLESS integration with a hybrid of PG Aggregators + Direct PG integrations helps you to control your payment success rates for eg. There are various PG Aggregators are available and you might have enabled different Direct PG merchant IDs with them (this is how PG Aggregators work because the commercial with Direct PGs is something merchants/clients bear while PG Aggregators charge for their service)
Direct PGs not only works best for your organisation pocket it also provides you good success rates if they provide dedicated resources for your transactions (Yes you can request them for the dedicated infra for your payment transactions, if the relationship is good) for eg. HDFCPG, AXISPG & ICICI3DMOTO used to offer these services and they have good success rates on HDFC, AXIS and ICICI credit/debit cards respectively.
3. Take care of SURL, FURL & CURL
During Payment Success Rate calculations we always consider Success over all the Payment attempts but internally the story is different. All PGs provide you the redirect URL option where after a payment transaction they would like to redirect the control
SURL = Merchant Success URL
FURL = Merchant Failure URL
CURL = Merchant Cancel URL
We often count Cancelled Payments along with Failed Payments but actually it is cancelled by Users after multiple failed attempts.
First you should configure the CURL with PGs and handle it just like SURL & FURL.
Second record the Cancelled Payments separately in your DB.
Third adjust your Success Rates keeping in mind Cancelled Payments should not affect your PG Success Rates as PG did its job in providing all the options to the users but it was their intentional call to mark the payment Cancelled. Below is an eg.
4. Update NetBanking Options Periodically
This is one of the exercise we used to do annually to update the major and minor NetBanking options in our Payment Systems. In 2012 there were 35 national banks which got updated to 60+ NetBanks in 2015 and now we have 80+ Indian NetBanking options (as of 2020)
Every year few banks get merged and we need to make sure we show the correct NetBanking options to our customers. This reduces their confusion and in turn bounce back from Payment Page of your platform.
5. Compare the Success Rates with PG Aggregators
Always record and compare the Success Rates with your PG Aggregators. This can be done manually or programatically both. As a lot of PG Aggregators provide the APIs to capture their PG Success Rates for different Payment Types on Daily as well as Hourly basis. Ask them to provide the GET APIs.
Why this is important? Your organisation can only compare the success rates of your payment transaction which is limited while PGs or PG Aggregators will have their success rates based on all the transactions performed by various clients/merchants like you. Higher the Transactions, Higher the chances of predicting the Success Rates.
6. Show Low Performance of Bank info upfront in the funnel
If a Bank is down or facing technical errors, the failure rate for that bank cards or NetBanking payment option will be higher. Based on your last 100 transactions or Week on Week comparison you can fetch this info OR you can get this info from PGs or PG Aggregators directly via API also. PayU, Razorpay Engineering and all big players provide you this info via APIs and you can configure the warning message up in the funnel For eg.
This proactive info saves the customer from unavoidable failed transactions which can turn into DSAT (Dissatisfaction metric) for your organisation.
7. Try Express Checkout for Repeat Customers
For Small Scale Org who can not afford to have Locker System which can save customer credit/debit card details they can reach out to their PG or PG Aggregators to enable something called “Express Checkout” where the PG can take the ownership of saving the customer card details for future transactions.
For Large Scale Org who can afford to have their own Locker System can build the functionality themselves for Inline as well as Express Checkout.
Be mindful in building your own Locker System you need to be PCI-DSS Certified (https://www.pcisecuritystandards.org/) Read more info here —
Needless to say Saved card transactions have better success rates as it reduces the pain and manual errors of the customer of filling card details every time if they are your repeat customers. Keep in mind to cleanup or notify the customers to cleanup the expired cards before initiating the transaction.
8. Have BIN Based Routing for Direct PG Integrations
When you are dealing with Direct PG integrations instead of PG Aggregators BIN based routing is something which comes handy.
What is a BIN? Its the first 6 digit of your credit/debit card.
You can take the list of the BINs from your bank which has better success rates processing them and enable/route those card transactions via Direct PG.
For eg. If HDFCPG works great for HDFC Diners card, collect all the Diners card BINs from HDFC Bank and enable HDFCPG as Direct PG for them instead of routing it to PG Aggregators. This is tested and verified modal, works well every time :) Want to know more, please read my previous blog —
9. EMI, BNPL (Buy Now & Pay Later) & Offline Payments are the future
Understand your product and your customer behaviour via Analytics and Feedback systems. Try to be on top of the new payment types which people are adopting to. UPI payments is one such great example. Provide these options in top of your funnels as customers can choose from various options.
Credit card payments are further segregated into -
- Credit Card with 0% EMI
- Credit Card with x% EMI
- Credit Card with Cashbacks
The same way BNPL has been in trend for regular online customers. Lazypay, EazyPay, Simpl & ApartPay are few such players out there in the industry.
Moreover Offline Payments are also catching up in India with ICICI Bank being first one to keep a tap on this. This particular payment method is quite popular in South East Asia & Latin America. Interested to know more —
10. Tweak your Alerting & Monitoring Systems regularly
You might have heard “One Ring Can Rule Them All”
Sadly this doesn’t work when you consider Payment Transactions. The rulebook changes each week, each day and each hour. So please keep your tech & analytics team up to date about how you want to calculate success rates and what should be the THRESHOLD you want to get alert notifications.
Few examples for beginners which you can apply easily in your system are :
- If Success Rate of a PG goes below your threshold for one Payment Type over last 100 transactions
- If Success Rate of a PG goes below your threshold for one Payment Type last overlapping 5 mins
- If PG or PG Aggregator API informs that one Bank is performing poorly
- If the delta between Week on Week graph of payment transactions decreases by X%
- If the PENDING response status increases in Failed Transactions (means whether payment is deducted or not has not been confirmed by PG)
One last piece of advise is never ignore the Bank Downtimes emails or notifications. Most of the Banks provide you this info via email thus its very important that you provide generic email ID while purchasing the Merchant ID from these Banks for eg. bank-notifications@yourcompany.com
And dedicate a team who can take necessary action on time for the same. For eg. As soon as you get the bank downtime email you can schedule a message to show in your platform during that time OR you can remove the option if possible for that period from your payment type options.
These are just a tip on the iceberg but it will help you settle down some missing pieces from the question Why our PAYMENT SUCCESS RATE IS LOW?
Hope you enjoyed the blog as much I loved to pen it down based on my experience and working with like minded product & tech team. And of course during all these integrations I have saved a lot of contact details of PG & Bank teams for negotiations/suggestions and complaints :)
Please comment if you have queries/suggestions or objections (if any).
“Happy Payments”
