In a world of unforeseen reboots, outages, service disruptions and more, to boost payments acceptance, merchants should consider establishing relationships with a range of acquirers if and when the need arises.
According to ACI Worldwide Executive Vice President Debbie Guerra, this so-called multi-acquiring approach is one way that businesses can not only ensure continuity, but can also ensure resilience by being able to take advantage of top-line opportunities wherever and whenever a backup is needed.
In the age of digital commerce, merchants need this hedge against banks being unavailable amid transaction volume surges, always-on (virtual) marketplaces and payments that wind their way across borders, time zones and currencies. At a high level, Guerra said, multi-acquiring means that merchants can save costs and improve their conversion rates.
Merchants need to have independence and choice in how they drive their transactions to multiple endpoints, Guerra said, noting that ACI’s own payments orchestration engine is “fundamentally a robust global gateway” with hundreds of connection points – and the points can be to an acquirer, a country or a payment type.
“Those choices are important and help govern where they send transactions to deliver the highest conversion rates,” she said – which, in turn, positively impacts revenue growth while delivering the best customer experience.
With a nod toward “smart routing,” Guerra said that customer payments typically can fail at checkout when verification efforts fall short or banks are down. The payment may be rejected, and frustrated consumers may abandon their online shopping carts. The smart routing construct means that card transactions are routed to different acquirers based on attributes that can include risk profiles or even card brands or locations.
Guerra noted that it may not make sense to always use global acquirers – it may be more efficient (and more cost-effective) to route a transaction to a local acquirer. Conversely, transactions that are not able to be completed with a local acquirer can be repeated with a global acquirer.
“Smart” retry functions can allow card transactions to be automatically re-sent to the same acquirer or to alternate ones to make sure they go through. As ACI has said, smart retry allows merchants and PSPs to configure authentication processes for each channel on a separate basis, without the need to update or adjust the integration anywhere else. The experience is improved considerably because the customer is not required to re-type details, while merchants enjoy higher acceptance levels.
“With some customers, we’ve seen it drive uplifts in transaction conversions as high as 15 percent,” Guerra said. Machine learning can foster “least-cost” routing to help merchants boost margins or avoid fraud.
Though the smart routing offerings can benefit merchants of any size or vertical, Guerra said that cost control and resiliency tend to be more of a focus for large enterprise players that can also negotiate acquiring rates with various schemes and payment methods. “But we’ve also seen a lot of interest from intermediaries such as payment service providers and payment facilitators, as well as firms that are looking to provide optionality for the merchants they serve,” she said.
There’s also interest stemming from the high-risk segments of merchants that want to have a deeper network of acquirers for resilience, such as CBD merchants.
Looking ahead, said Guerra, “we’re seeing the explosion of consumer demand that merchants make a choice of payment method available, and it’s really showing up with a lot more focus on local payment methods and alternative payment methods” such as buy now, pay later (BNPL).