56% of Consumers Have Faced a False Payment Decline

Your fraud prevention tools might be costing you more in lost sales than they save in prevented theft. A new report reveals that 56% of consumers have experienced a 'false decline,' where a legitimate transaction is blocked by a merchant's payment processor. For retailers, this is a major growth killer. When a customer is ready to buy but gets rejected at the finish line, they rarely blame their bank; they blame your brand. Many will simply abandon the purchase or shop with a competitor who makes the process smoother. The data suggests that many merchants have tightened their fraud controls too far. While protecting against chargebacks is important, overly aggressive filters are catching honest shoppers in the net. This 'performance gap' represents a massive opportunity for revenue recovery. By optimizing payment processing and adjusting fraud sensitivity, operators can capture the sales they are currently pushing away. The focus should shift from strictly minimizing risk to maximizing transaction approval rates. In a competitive market, ensuring a frictionless checkout experience is often more profitable than trying to eliminate every single penny of potential fraud risk.

Source: PYMNTS

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