Reduce Card Declines: Top Tips for Business Owners

You’re excited about your new purchases; you imagine yourself walking down in the street in your new outfit and the look on your son’s face as he unwraps his birthday gift. You give the store assistant your card, and then you see the message – “declined”.

Having your card declined is towards the top of the list of the most embarrassing things that can happen to a consumer. For companies, card declines can damage the customer’s impression of your brand, and they may feel too embarrassed or angry to transact with you again.

Studies show that around a third of customers who experience a declined payment blame their merchant over their bank; what’s more, they may interpret a declined payment as a sign not to purchase, or that they should go with your competitor.

As business owners we naturally want to minimise the risk of declined payments to protect our revenue; however, we also need to guard ourselves against fraud-related losses.

So, why do card declines occur, and how can we reduce the risk of card declines and failed payments for consumers and businesses?

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Why do card declines happen?

Declined payments can occur for a multitude of reasons, such as:

  • The customer has insufficient funds.
  • The card has expired.
  • The bank has put on stop on the card for security reasons.
  • The bank or the payment processor has a technical issue.
  • The spend may look unusual against the customer’s typical spending patterns.

Another merchant may have a hold on the card that they neglected to remove, for example, a rental company or a hotel, so less money is available than expected.
Given the multiple causes of card declines, how can we reduce the risks of this happening?

Accept multiple payment options

One of the easiest ways to reduce the risk of lost revenue from card declines is to ensure that your payment options accept many different types of payment, for example, credit cards, debits cards, mobile wallet payments, PayPal etc. Customers will generally be carrying multiple cards.

Work with a payment solutions provider who can equip you with a range of payment solutions from a mobile card machine, to an eCommerce Payment Gateway.

Try the payment again

If there is a chance that the decline is due to a network issue, or a lag in the customer verifying a payment to their bank, then you can try processing the payment again.

Get set for Strong Customer Authentication

Strong Customer Authentication (SCA) is a new standard that applies to merchants who take payments within Europe. SCA is a core component of the Payment Services Directive 2 (PSD2) legislation, which protects payments within Europe while also encouraging increased levels of innovation.
With SCA, card payments become more secure through a customer verifying themselves in two ways when using their card, from a list of three verification options. The three verification options are:

  1. The customer demonstrates knowledge in the form of a PIN or password.
  2. The customer authenticates through a mobile phone or a card reader in their possession.
  3. The customer’s biometric data such as a facial scan, a fingerprint scan or an iris scan provides a unique verification.

Some payments are exempt from this process such as low-value transactions that meet specific criteria, low-risk purchases, ongoing subscriptions and fees to trusted beneficiaries.
In the UK, merchants must be ready for SCA by the implementation deadline of 14 September 2024. However, random checks of e-commerce payments will take place from 1 June 2024, so make sure that you are working with a payment solutions provider that is SCA-ready to avoid declined payments.

Have a smooth online checkout process

Have a simple online checkout process with as little friction as possible, to reduce the risk of your customers going to your competitors. Make sure that you have a cutting edge and compliant eCommerce Payment Gateway that minimises the risk of false payment declines.

Protect subscriptions with account updater services

Expired cards are a big challenge for businesses that take payments on a subscription basis. Visa and Mastercard offer services to automatically update the customer card information that is stored in your eCommerce Payment Gateway so you can continue the recurring payments.

Contact all online declined payment customers

An abandon cart message shows that a customer has tried and failed to buy from you online.

Select a member of your team who will monitor failed online payments and proactively contact those individuals to assist them. Find a way to make this a positive experience and deepen the relationship; for example, giving the customer access to a better price, or additional value for the same price. Your efforts will quickly turn a negative experience into a positive.

Pick the best payment solutions provider

The most critical step to reducing card declines is to pick a credible payments solutions provider.

Look for a company that offers the full range of payment solutions that your business needs to succeed; whether they are mobile card machines, countertop card machines, or an eCommerce Payment Gateway.

You’ll also want to check that your payment provider is ready for PSD2 and that all of its payment options are compliant with SCA requirements.

Ask about the payment solution provider’s fraud processes. For example, payments experts UTP Group partner with a well-known bank to benefit from its intelligent fraud identification processes, but above and beyond this, they offer a unique level of extra protection for merchants in the form of additional daily fraud checks (for more information visit They also provide faster card processing so that you can have the funds in your account as quickly as within an hour of collecting the payment.

Conclusion: be proactive in protecting your revenue

Card declines are not an enjoyable experience for you or your customers. However, there are many steps that you can take proactively to reduce your chances of losing revenue and damaging your reputation.

The most crucial step is to partner with a payment solutions provider who will help you to keep card declines to the absolute minimum, while protecting you and your customers from fraud.