There are multiple payment mode options to make online payments such as debit cards, credit cards, UPI, mobile wallets, net banking, QR code, etc. It is a normal scenario that the transaction could fail due to some uncontrollable reasons.
PayKun provides a very high success rate for the transactions by minimizing the controllable transaction failure from the payment gateway. This way it reduces the failed transactions that could be controlled at the payment gateway platform level.
This blog mainly discusses the major causes for the transactions to fail. First, we need to understand how does the transaction flow goes once it is initiated by the customer.
Transaction Process Flow
If you have experienced an online payment then you would know that the whole process completes in seconds. However, in the background, there are various steps and multiple parties involved. The payment goes through various stages before it reaches the Acquiring Bank and this increases the number of reasons for transaction failure:
Step 1: Customer Order Created
The customer chooses the product and moves toward the checkout and fills in the required details. The Order ID is created on the website after the information is sent to API then the payment gateway API is created.
Step 2: Send Payment Details
Then the customer proceeds to initiate the payment at the payment gateway checkout. He enters the details according to the payment method option selected.
As per the payment option, the details are sent to the Payment Gateway server in a secure manner. So in this step, the card networks, wallet service providers, etc are included.
Step 3: Authorization of Payment
In this internal process, the payment gateway sends the authentication request to the issuing bank to deduct the customer’s payment. If the authorization is obtained then the payment is deducted and sent to the acquiring bank.
The payment is auto captured on the merchant side after the bank has authorized it and the purchase is considered completed.
Reasons for the failed transactions:
So now after understanding what all destinations and parties are involved, let us understand the reasons due to which the transactions might be getting failed:
- Bank Authorization
In the above step 3, when any issue comes up in authorizing the payment from the Issuer bank because of some reason and the customer’s bank cannot be connected at all. This way the payment gateway does not come in the picture and the issue was from the bank side for the payment failure.
- Authentication Failure
The authentication might fail due to various reasons, for example, if any wrong information is entered during the payment process then the transaction will fail, such as OTP or password entered wrongly.
- Insufficient Balance
There might be bank related issues such as there is not enough balance in the customer’s bank or the payment method/bank details are entered wrongly.
- Transaction not Supported
In case the payment or customer details such as international number, country, or currency is not supported by the payment gateway then due to that the 3D authentication would fail, and eventually the transaction will fail.
It is possible that the international transactions are supported but the customer’s card/payment method does not support the payment gateway type.
Another scenario can be that the Card details or other transaction details are entered incorrectly.
- Connectivity Problems
There might be a network connection failure or the internet connectivity issues during the transactions the transaction will get failed.
- Bank-side Security
Bank has certain bank security measures put in place and it keeps certain tracking on the authorization of the transactions of the customers. This may include the buying behavior of the customer not matching the transactions or the payment amount of the transaction or the customer card is put on hold by risk. For this, the security measures would result in the transaction failing.
- Late Response
Due to any reason, there might be a delay in getting the actual status of the transaction. The response of success or failure of a transaction is not received from the bank itself. In such cases, the reconciliation process is done to know the actual status of the transaction.
In that situation, the delayed capture feature on PayKun can be helpful and as per the actual status of the transaction, the transaction status turns success or becomes failed after 24 hours. If it is less than 24 hours then the payment gateway customer support can help you with the actual status of the transaction.
Server and Bank downtime can result in the failure of the payment. During this, time the authorization request to the bank servers fails, and eventually, the transaction fails.
What happens with the failed transactions?
There can be two consequences:
Most of the time the payment amount does not get deducted.
But sometimes the payment might be deducted from the payment source.
During the authentication step, the confirmation from the bank side gets delayed due to load or technical issues.
In such transactions, the payment is deducted but the status is unclear. With the reconciliation process from the bank side, the exact status can be known by the payment gateway after 24 hours.
After that, if the payment is successful then well, it is a success, and if not the payment is auto refunded. The days to receive the refund depends on the payment method as below:
Wallet: 15 To 17 Working Days
UPI: 2 To 3 Working Days
Debit/Credit Card & Net Banking: 5 To 7 Working Days
PayKun Payment Gateway provides the highest successful transaction rate. The advantage of this is that the failed transaction is minimum and this ensures a positive impression on the customer. As we already discussed, there are various reasons for the transactions getting failed. PayKun technical team continuously works to rectify any error coming from its side and bringing down the preventable failed transactions to the minimum. PayKun even provides the reason for the transaction failure for most of the payments (for the ones for which we receive from the bank side).