What is an authorization rate? How payment infrastructure providers can increase payment acceptance rates. The promise of good payments infrastructure.
Hey Jareau - Curious to hear any thoughts you have on the 'MID warming' process (aka getting over the initial hurdle of lower authorization rates when you open a new merchant account).
I've always found it difficult to explain the phenomenon to merchants who are switching PSPs, as there is rarely much a PSP can do to get through the first few weeks with a new MID (to your point about your call with Wells and Vantiv).
I haven't executed this practice myself but understand the theory behind it. A PSP that is using distinct MIDs (e.g. a wholesale ISO) could likely arrange a MID warming scheme for their new clients behind the scenes. More challenging for an aggregating PSP to pull off. Thanks for mentioning!
Are most of these auth rate improvements from the acquirer/merchant perspective? I've worked a lot with issuer and processor side and know that responsibility with auth rates can totally differ based on an issuing or acquiring perspective. Thanks!
A mix of all entities in the payments system (acquiring processor/bank, network, issuing processor/bank). For example, network tokens are seen as more secure by issuing banks so are often given lower risk scores, leading to higher auth rates. The ML-powered retry logic and dynamic formatting of messages is all on the acquiring side.
Hey Jareau - Curious to hear any thoughts you have on the 'MID warming' process (aka getting over the initial hurdle of lower authorization rates when you open a new merchant account).
I've always found it difficult to explain the phenomenon to merchants who are switching PSPs, as there is rarely much a PSP can do to get through the first few weeks with a new MID (to your point about your call with Wells and Vantiv).
Great article - thank you for sharing.
I haven't executed this practice myself but understand the theory behind it. A PSP that is using distinct MIDs (e.g. a wholesale ISO) could likely arrange a MID warming scheme for their new clients behind the scenes. More challenging for an aggregating PSP to pull off. Thanks for mentioning!
Are most of these auth rate improvements from the acquirer/merchant perspective? I've worked a lot with issuer and processor side and know that responsibility with auth rates can totally differ based on an issuing or acquiring perspective. Thanks!
A mix of all entities in the payments system (acquiring processor/bank, network, issuing processor/bank). For example, network tokens are seen as more secure by issuing banks so are often given lower risk scores, leading to higher auth rates. The ML-powered retry logic and dynamic formatting of messages is all on the acquiring side.