One of the top complaints from a customer is why their payment was declined. The transaction can be declined by the bank issuer, bank acquirer or by the processor. This unpleasant issue can also affect the merchant's approve ratio, so it is important to control customers failed purchases and understand why it has occurred.
Most declines that come from issuing banks send generic code reasons, so for more information, it is better to contact the customer's bank to avoid similar problems in the future.
There are soft and hard declines. The soft ones can be caused by a temporary issue and may be retried, while the hard ones are the result of an error that cannot be resolved immediately.
The most common reasons for a transaction decline are:
- Insufficient funds.
The customer has not enough money on a credit card to make a purchase;
- Incorrect card details.
e.g incorrect or incomplete CVV/CVV2 number or typo in credit card number;
- Card has expired.
A credit card expiration date is not valid anymore;
- Billing and card statement address mismatch.
When customer's billing address doesn't match their physical location, e.g customer may be on a business trip to another country;
- Limit exceeded.
When a customer attempts to make a transaction that exceeds the limit stated on their account;
- Anti-fraud block rules.
Transactions get declined when anti-fraud system detects an unusual pattern for a customer, e.g too many attempts to make a purchase in a short period of time or risky billing location.
The more data merchant collects from his customers the more chances to avoid troubles with payment flow and operate within an acceptable decline ratio.
The decline reason for the specific transaction may be found in Analytics Transaction report fields ERROR CODE EXPLANATION.
For more detailed analytics of the approve ratio please use the Approve ratio report.
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