Why Payments Fail - and What You Can Do About Them

Payment Processing Explained

Usually, a customer has no idea what actually goes on 'behind the scenes' when using their preferred payment method. Whether it's card payments, or online payments, to the average consumer, completing an online transaction is as simple as the click of a mouse or the tap of a screen, and takes place in mere seconds. In reality, there are quite a few steps to go through, and consumers only realize that things aren’t so simple when they experience a failed transaction.

From the customer to the merchant, the payment process goes through several more steps after it enters the payment gateway.

What causes payment failure?

Failed payments can occur from both the merchant’s end and the customer’s end. 

It’s a common experience and may be caused by any number of reasons. But when it happens to you, it’s frustrating, embarrassing and if you don’t have an alternate form of payment, it can be a huge hassle.A rejected payment from a customer's end is not generally something a merchant can fix. Here are some common customer payment failure alerts.

Knowing why your credit card was declined and what steps you can take to prevent it from happening will help ensure your next transaction goes through without a hitch. 

10 Reasons 

1. Deemed inauthentic - If an issuing bank or acquirer deems that the attempted transaction is not authentic based on the consumer’s previous charge history, they will deny permission for it to go through.
2. Location - Banks and acquirers can also deem a charge inauthentic if the consumer is trying to pay from abroad. Additionally, not all credit cards support international charges.
3. Spotty internet connection - A stable internet connection is the backbone of any online transaction. When a consumer’s connection isn’t stable, they can try paying at multiple sites and will always end up frustrated.
4. Downtime/maintenance - Sometimes, payment gateways, processors or issuing banks have downtime, during which the site is being repaired or updated. This can lead to a failed transaction.
5. Payment method not supported - Not all online merchants accept all types of credit cards. When this happens, a consumer can enter their information, but ultimately the transaction will be rejected.
6. 3DS2 friction- 3DS2, a multifactor authentication protocol, is designed to reduce friction in the online checkout process. Merchants and banks can share information quickly and determine if a transaction is risky. If it’s fine, it goes right through. If it’s risky, the customer is required to provide an additional piece of information, like a fingerprint, face scan, or one-time password. If a customer isn’t able to provide this information or doesn’t want to, the payment can fail.            For reference Link: Secure Online Shopping Everywhere in the World | Visa | Visa
7. Insufficient funds - In some cases, the issuing bank determines that the cardholder doesn’t have enough money to pay for the items. In this case, the payment will be denied.
8. Exceeding the single charge limit - Some consumers have sufficient funds but are limited in how much they can spend in one transaction. If they try to buy something that’s over that limit, the transaction can be denied.
9. Mismatched data - If the cardholder enters data that doesn’t match the information the issuing bank has on file; the transaction can be denied. This can include a wrong card number or wrong password.
10. Expired credit card - If the consumer provides outdated information, the transaction won’t go through.

What to do when your card is declined?

As a merchant, you should check the payment failure details and identify the player responsible for the error. Then contact that roleplayer responsible for payment failure. Most payment service providers have their own set of response codes for when payment is not authorized successfully. Every code should identify the reason for payment failure. Even though codes vary from provider to provider, the reasons are usually the same.

As a customer, the first item on your to-do list after your card is declined should be calling your credit card issuer.

If you have an app for your credit card, you should check that, too. Look for fraud alerts or any suspicious activity within your transactions, as well as issues involving your balance and payments. Once you call your issuer, a representative will be able to determine why you were unable to make the transaction and help you work out a solution to regain access to your credit line. 

If it was a case of suspected fraud, you may be asked to verify previous purchases or your location to prove you are the account holder. If your card is expired, you’ll need to go home and activate the new card. Missed payments and closed accounts may be a bit more time-consuming to solve, but your issuer can help you explore options for repayment and bring your account back in good standing.

A referral to a voice authorization center was received. Please call the appropriate voice authorization number below for the card type being used:

• American Express:  (800) 528-2121 

Link: https://www.americanexpress.com/en-us/credit-cards/credit-intel/reasons-for-credit-card-decline/

• Visa/MasterCard:   (800) 228-1122

Link: https://usa.visa.com/  

        https://www.mastercard.us/

• Discover/Novus:   (800) 347-1111

Link: https://www.discover.com/credit-cards/card-smarts/credit-card-declined/

• Diners Club:   (800) 525-9040
• JCB:   (800) 522-9345

Customers Always Think that Merchants are Fraudulent when they Facing Payment Issues

In fact, payment failures can be due to a variety of circumstances, including verification issues on the part of the bank, an unstable internet connection, or limitations of the payment method and the bank. These issues are sometimes not within the merchant's control.

In order to resolve the issue as soon as possible, you can try the following steps: [retrying the payment, using a different payment method, contacting your card-issuing bank for confirmation, etc.].

In conclusion…

Online payments is a set of complicated processes that, sadly, tend to fail. But it is no exception to real-life payments.Even paying with cash can result in a failure, as a cash register can sometimes get jammed.

If you have any questions or need further assistance, please feel free to contact us. We value your experience and want to make sure your order goes smoothly.

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