How to Boost Payment Acceptance Rates: A Comprehensive Guide

The payment acceptance rate is a key performance indicator that reflects the ratio of consumer-initiated transactions that were completed successfully. As practice shows, a good benchmark for this KPI is anywhere around 80% or higher, so if your eCommerce business consistently sees lower figures, it is a clear sign that it is time to reconsider your approach.

In this guide, we share the most effective strategies that are sure to help you take your company’s payment acceptance to a higher level. Keep reading for all the useful insights!

How Can eCommerce Businesses Improve Payment Acceptance?

While there is no one-size-fits-all approach to all scenarios, the strategic adjustments listed below have a proven track record of driving positive change for eCommerce businesses across various industries. Here are some steps you should consider taking:

1. Adopting a Balanced Approach to Transaction Security

Achieving this equilibrium is possible by taking the following steps:

• Implementing advanced automated fraud detection tools
• Collaborating with reliable payment service providers
• Utilizing robust encryption methods
• Educating customers on existing security measures

Finally, eCommerce businesses should continuously conduct security audits to identify vulnerabilities and ensure compliance with the rapidly evolving industry standards.

2. Introducing Manual Reviews

Automated systems are not always accurate when it comes to flagging transactions as suspicious, which can lead to false positives. Introducing manual reviews by trained personnel can be a game-changing step toward minimizing such errors.

However, it is crucial to remember that relying on human oversight too much can be counterproductive. As a rule of thumb, experts only need to be involved in the process if they need to reach out to customers for the sake of conducting additional checks.

3. Adjusting Authentication Protocols

Tweaking payment authentication protocols can significantly streamline the checkout process and, consequently, enhance acceptance rates. Some features worth considering include:

• Biometrics. Implementing fingerprint or facial recognition can be an extremely helpful solution for eCommerce businesses seeking to optimize customer identity verification. In fact, 29% of Gen Z consumers prefer this authentication method due to its speed and convenience.
• Risk-based authentication. Merchants can also benefit from tailoring authentication requirements based on the perceived risk level of each transaction. What’s more, the latest research shows that the majority of users favor RBA over two-factor authentication (2FA).
• Tokenization. Replacing sensitive data with unique tokens has proven itself to be a powerful approach to minimizing the risk of data breaches during transactions without affecting user experience.
• Adaptive authentication. An increasing number of merchants turn to machine learning for its capability to analyze user behavior and adapt authentication requirements based on real-time data.

Moreover, it can be extremely helpful to implement a tailored mix of these approaches based on the specific business needs and target audiences.

4. Collecting User Feedback and Conducting Testing

eCommerce business owners must prioritize continuous improvement and focus on gathering client feedback through surveys and post-purchase inquiries. Based on the insights gained from this data, they can test different payment methods and flows and adjust them accordingly.

5. Staying Up-to-Date with Industry Trends

It is also paramount for eCommerce business owners to keep up with trends in the fraud and payment scenes. While this step may not be influencing acceptance rates directly, staying ahead of the latest industry developments enables merchants to anticipate potential threats and implement proactive fraud prevention measures, which, in turn, inevitably supports smooth checkout.

Other Payment KPIs eCommerce Businesses Should Keep in Mind

Other essential metrics that need to be kept in check include:

• Chargeback ratio
• Average transaction value (ATV)
• Time to payment
• Customer lifetime value (CLV)

The list goes on, as the only way to deliver exceptional payment experiences to customers and sustainably boost long-term business revenue lies through adopting a holistic approach.