False Declines, the bane of the payment industry

False declines, can be a neverending source of irritation for eCommerce retailers. False declines are valid transactions (would-have-been sales) that are rejected due to fraud speculation. Simply stated, they are legitimate transactions that are being wrongly denied. Profits are diminished when a successful sale is missed due to a false decline.  

Consider a false decline from the buyer’s perspective. They most likely spent time researching their wants and needs. In most cases, the process of purchasing goods is the same. The buyer devotes time to researching various products, reading customer reviews, and comparing features. Finally, they make a decision to buy, and the payment is rejected. 

Next, what will happen? One of two things will usually occur when a legitimate customer request is rejected. Either they choose a different card to make the payment with, or they take their business elsewhere and buy from another merchant. Once a customer has decided to switch merchants, there is a slim to no chance of that customer returning to your platform. Merchants should also be wary of bad press about them on social media when customers share their bad experience with everyone. In the end, false declines lead to consumer dissatisfaction and reduce both merchants’ and card issuers’ profits.  

Merchants and issuers should not be forced to track down false declines. However, there is a solution to this problem. In order to correctly detect fraud and reduce the likelihood of false declines, it all starts with authentication of the cardholder at the time of payment, and the integration of a 3D Secure solution that is compliant with EMVCo‘s 3D Secure 2 payment authentication protocol. This adds an additional level of security, which helps to reduce false declines, reduce fraudulent transactions, and increase issuer payment approvals.  

Solutions that can help merchants, issuers and payment service providers are offered by GPayments. All are EMVCo certified solutions, providing a complete range of integrated authentication products based on the 3D Secure 2 protocol, and are compliant with all the major card schemes.  

3-D Secure 2 is the most recent set of protocols that can authenticate Card-Not-Present transactions, on any device, while reducing false declines through improved risk-based authentication. Over 100 data elements, involved in the cardholder-merchant transaction, are shared with the issuer to aid in the risk-based authentication of the cardholder, allowing the issuer to authorise transactions with greater accuracy. 

Due to the amount of information, about the cardholder, collected during the payment process, using EMV 3DS will result in smooth and efficient authentication, fewer challenges to the cardholder, fewer declined transactions, increased approvals, enhanced customer confidence, and an improved, more frictionless shopper experience. 

Are you a merchant who wants to increase your profit margins? We have been helping businesses reduce fraud and false declines for more than 20 years. Get in touch with GPayments and let us help you reduce false declines and boost your bottom line.