Subscription businesses that want to optimize their payment process and gain an edge over their competition should consider integrating with a second payment gateway. A second gateway can offer increased operational efficiencies along with a variety of other benefits.
What are some of the advantages of having multiple gateways?
Can be used as a backup if your primary gateway goes down
While not a frequent occurrence generally, payment gateways do at times suffer issues. When this happens, transaction declines can skyrocket. The worst-case scenario is a complete outage during which no transactions can be processed. This means that if a new subscriber is attempting to sign up for a subscription, they won’t be able to—and they may never return to try their purchase again. You lose not just their initial purchase revenue but also their subsequent recurring revenue. This loss of revenue can be particularly devastating to high-volume businesses that process a large number of transactions in a short timeframe.
If you have a second gateway enabled, you can route transactions to this gateway when your primary gateway experiences issues or outages, ensuring that any new sign ups or renewals are processed successfully.
Allows you to optimize payments
Some gateways may deliver higher acceptance rates for certain transactions, based on the geolocation from which the transaction originates. Or one gateway may charge a lower processing rate for certain payment methods such as ACH
Or, one gateway may perform better than another for one-time purchases or for renewal payments.
Can improve acceptance rates
Conduct A/B tests with your two gateways to determine which has higher acceptance rates for certain transactions. Then, route those transactions to the better-performing gateway to minimize declines.
Eases your expansion into new markets
In certain regions, if the payment gateway you’ll use to process payments has local acquiring capabilities, this will make your entry into that market easier. It will eliminate cross-border charges, thus lowering your processing costs and potentially increasing acceptance rates.
Allows for load balancing and risk mitigation
If you experience heavy processing loads during peak periods, having a second gateway will let you offload some of the traffic to the other gateway. This will minimize the risk of any issues or outages which might impact transaction success—and conversions.
Streamlines the financial reconciliation process
Having multiple gateways enables you to route certain transactions to different gateways. For example, you may choose to always route a certain product line to a specific gateway. This eases the financial reconciliation process when the reconciliation needs to be separate for different lines of business or different products.