Declined payments are bad news for merchants and consumers but there is a solution. Rob Crutchington, CEO of Encoded, explores the power of payment orchestration for healthier profits and a smoother checkout experience.
Last summer, when a worldwide tech outage left shoppers unable to make card payments across the UK, the evils of an increasingly cashless society were exposed. Despite this, card payments continue to rise. ‘Worldpay Global Payments Report 2025’ predicts that cards will account for 56% of global consumer payment value in 2030, roughly the equivalent of a staggering US$ 32.5 trillion!
Great news for e-commerce but unfortunately, card payments don’t always work and they come with hidden costs. Online authorisation sees payments declined at a rate of nearly four times higher – 15% versus 4%, compared to when a card is presented physically. Even worse is the impact on customer satisfaction, brand loyalty and sales. More than half of would-be customers will abandon a purchase that requires multiple attempts to complete.
Merchants need to find ways to ensure card payments are processed efficiently and ideally, first time to avoid expensive fees and chargebacks.
Valuable insight helps make the right decisions
Understand declined codes
Identify which declined codes are actionable
Understanding whether declined codes are actionable can make a huge difference in increasing the number of payments accepted. For example, 54 (Expired card) or Error 51 (Insufficient finds) presenting a sympathetic and meaningful response requesting an alternative card might have a positive outcome. Always keep in mind that the card issuer is ultimately responsible for generating the authorisation code. Ensuring that as much relevant information is collected as possible and sent to the issuer can make all the difference. An example of the non-actionable decline code might include 07 (Pick up card-fraud). As suggested, the issuing bank has stopped the card due to suspected fraud.
Monitor payment decline ratios
3 reasons to explore payment orchestration
Modern tech innovations such as payment orchestration are a welcome addition to a payment gateway by offering a secure, frictionless online payment process from payer to payee using one integrated solution.
The technology safeguards against payment failures in the following ways:
1. Cure-all for declined transactions
2. Bespoke product-specific acquiring services
3. Consumer choice, tangible business savings
With the right information and technology, merchants can ensure every transaction is a profitable one. For more ideas on how payment orchestration can keep your business healthy and customers on your side, download Encoded’s Guide to Payment Orchestration.
