Digital payments have become indispensable parts of our daily lives. Consumers use them for every little expense, whether booking movie tickets, purchasing a mobile phone, or paying utility bills. In FY 2021 alone, more than 40 billion online transactions were reported in India, amounting to over one quadrillion rupees.
Although the scope of digital payments seems glorious, a business owner cannot neglect one aspect it involves – transaction success rate. Sometimes, transactions fail when the customer pays for purchase through a payment gateway, but it does not reach the seller. Technical issues and incompatible payment methods are primarily responsible for transaction failures. Therefore, in any case, the transaction success rate is a crucial metric that merchants must understand well.
Let’s dig deeper and understand the transaction success rate better. Later, we will discuss a few measures a business can use to improve it.
What is Transaction Success Rate?
Transaction success rate (TSR) is the percentage of successfully completed digital payments. It indicates the merchant’s number of payments for every hundred payments buyers made on the seller’s app or website. For instance, if a hundred buyers made digital payments to a seller and the merchant received 75 of them, the transaction success rate is 75%. The fact is that most consumers do not re-attempt a failed payment due to the fear of money getting stuck, leading to lost business and revenue. Customers expect a smooth digital payment experience without any annoyance and additional steps.
Measures to Improve Transaction Success Rate
A low transaction success rate implies that all the business’ money and effort in marketing and attracting customers goes waste. So, here are a few measures to improve this percentage.
Ensure Smooth Checkout: A smooth checkout process reduces the users’ chance to abandon the cart or cancel a payment. A laborious and overly long checkout procedure leads to a high number of abandoned carts.
Ask for Minimum Details: Select a payment provider that does ask for irrelevant information from the users at the checkout. The minimum effort and time required to finish the purchase deliver a good customer experience. All a merchant needs to process a transaction is the customer’s contact details, delivery address, and payment details. There is nothing to do with the customer’s date of birth or marital status.
Don’t Force Sign Up: While regular customers are invaluable assets for a business, do not make signing up mandatory. Numerous users may cancel the payment if forced to create an account at a site or app. The best measure is to allow guest checkout. Once the transaction is complete, contact them via message, phone, or email to request to sign up with a pleasant offer. The customers will sign up to gain benefits if they like the service.
Saved Payment Details: Saved payment details are absolute blessings for online businesses. No one likes to enter UPI IDs and 16-digit card numbers repeatedly. Saving these details and displaying them at checkout makes the purchase easier and faster for the customers. Using an efficient payment gateway can help provide this checkout experience.
Diverse Payment Methods: Customers have their preferred payment methods. If the payment platform does not support it, they may cancel the payment and reduce the transaction success rate. Therefore, select a payment provider that supports various payment methods, from cards and net banking to UPI and digital wallets. “Buy Now, Pay Later” is another explosive functionality that allows customers to pay for their purchases in EMIs.
Ensuring customer delight and smoothing the checkout process are the best measures to improve the transaction success rate. However, implementing them is not as simple as it seems. So, integrate a feature-rich, highly advanced, secure payment gateway into the eCommerce website or app and watch the TSR improve.