What is Smart Routing? Benefits for your ecommerce.

Diego Katzman

Diego Katzman
Published 20/10/2020 · 3 min read

How to optimise your payment system? Discover the financial services adapted to e-commerce in 2020 

In response to the constant evolution of e-commerce (which is becoming increasingly important), payment service providers (also known as PSPs) come on the scene. Some of their objectives include offering services adapted to the new regulations governing the operation of electronic payments. Regulations such as the European PSD2, created to regulate online payment services and ensure the protection of the digital buyer. If you want your e-commerce to grow, consolidate and (ultimately) sell more online, keep reading.

 

Smart routing for maximum successful transactions

Whether you've been managing your e-commerce website for a long time or not, you sure know about failed transactions. And, more importantly, what they mean: lost sales, frustrated customers, and lost time and resources. The nightmare of any ecommerce. To solve, Smart Routing was developed by expert financial consultants such as PayXpert.

Here's what failed transactions are all about, and how to put an end to them.

There are many factors that can influence failed transactions, but they can be summarised into three main categories. Either insufficient funds (on the part of the buyer), fraud prevention (optimisable through an efficient payment management system) or technical failures (avoidable, through this same efficient payment management system).

As you can imagine, little can be done in the first case. Insufficient funds is the easiest reason to understand, and one we can do nothing about. Although technical failures or fraud prevention are infinitely more complex reasons, thanks to the work of Payment Service Providers, they are also more easily predictable by the seller. In other words, they fall within our scope of action as financial consultants.

 

A multi-acquirer payment gateway: maximise your conversion while preventing fraud

Behind technical failures or denied transactions are e-commerce websites with poor payment gateways. Either because they have been on the market for a short time, or due to lack of knowledge, these sites work with Payment Service Providers with an insufficient network of acquiring banks.

 

What are acquiring banks?

Acquiring banks are financial institutions which allow a merchant (whether electronic or physical) to process transactions on their customers' credit and debit cards. In other words, it is the intermediary between your customer’s bank and your merchant’s bank, and it is indispensable for the transaction to take place. Too complex? We explain the transaction process step by step:

  1. Your customer uses a credit or debit card in your business, starting the transaction.
  2. Your payment gateway sends the card information to the payment processor, which sends a request to your customer's card network, awaiting authorisation.
  3. The card network (e.g. VISA) requests approval from the issuing bank, or our customer's bank account. This gives authorisation to initiate the cash flow.
  4. The acquiring bank processes this authorisation and makes a deposit into the merchant's account, while receiving the same amount from the issuing bank (or customer's bank account).

The acquiring bank is therefore an essential link in the purchase process. But what if it fails? Many merchants suffer failures in their payment gateways on crucial days of the business calendar: Black Friday, Cyber Monday... Many times, this is solved by a multi-acquirer payment gateway. In other words, it is like hiring several internet connection services to have an alternative in case any of them falls, always using the most efficient one in each case. Hello, Smart Routing. In this way, we get a fully optimised payment gateway with the highest rate of successful transactions.

 

Reasons why multi-acquiring will help your ecommerce sell more online

In a market as wide as the digital one, it is of vital importance to have a multi-acquiring payment gateway. In this way, we remove one of the main causes of failed transactions. Here's why:

  • Having multiple acquiring banks allows you to sell in more countries. Your payment gateway’s multi-acquiring guarantees you greater compatibility with foreign banks.
  • Say goodbye to network saturation. Saturations, also known as Time Outs, deny many transactions on days of high digital traffic. By expanding transaction management channels, we avoid such rejections.
  • Do technical problems arise with any of the networks? The payment gateway detects it and redirects the transaction to another one that is available.

 

A multi-acquirer payment gateway has an approval rate of up to 5% higher

You're probably wondering how to start working with a multi-acquirer payment gateway. Where can I find it? How do I know if it's the best one? What else can it do for me? As expert financial technology consultants, we at PayXpert have the answers to all these questions.

Because we offer so much more than payment gateways. We specialise in the financial optimisation for companies like yours. We offer multi-channel payment services (click here to rediscover the ways you can accept payments from your customers), we help you manage fraud (click here if you want to know how to tackle one of the main problems of e-commerce). In addition, through Data Management, we transform the data generated by your financial activity into valuable statistics that will allow you to quickly and deeply understand the operation of your activity, giving you tools to carry out an improved management control.

 

Discover the tools that will allow you to analyse the KPI's of your payments

More than multi-acquirer payment gateways, and more than financial optimisation tools and services. At PayXpert we work to create added value for our customers. Our goal is to design tools that save you time and money. Resources that you can redirect to the continued growth of your brand and identity. Financial technology aimed at the well-being of companies and their teams. 

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