Merchant Account Management

I've helped dozens of acquirers, including Adyen, Checkout.com, and others optimize their authorization rates. 99% of them fall into 3 big traps... Mistakes that keep them bleeding revenue through unnecessary declines. Here's how to quickly fix them (so you can start maximizing approval rates today): Before data scientists got involved in payments, optimization wasn't really a thing. Engineers just found the fastest way to get their work done, often creating these systemic issues that persist today. So here are a few traps to avoid and how to fix them: TRAP 1: Generic Response Code Abuse Most teams send 80%+ of declines as "05: Do Not Honor" or "51: Not Sufficient Funds." This renders your data useless. You can't identify trends, optimize strategies, or help merchants understand why transactions fail. Strategic Fix: Treat response codes as your optimization roadmap. The more granular your codes, the more likely you are to find patterns that can drive intelligent retry logic and merchant coaching. TRAP 2: Blanket Decline Strategies Teams block entire countries, merchant categories, or transaction types "just to be safe." This kills legitimate transactions and frustrates customers who then switch to competitors. Strategic Fix: Risk is contextual, not categorical. Build dynamic risk models that consider transaction velocity, device fingerprinting, and behavioral patterns rather than static rules. TRAP 3: Static Authorization Hold Periods Most acquirers hold authorizations for 7+ days, blocking customer spending power unnecessarily. Strategic Fix: Authorization holds are working capital management. Analyze settlement timing by merchant segment to optimize cash flow without increasing risk. Other ways to increase authorization rates and revenue include: Account Updater: Automatically updates expired card details with merchants, preventing recurring payment failures Stand-In Processing: When issuers are offline, optimized STIP parameters can approve low-risk transactions instead of blanket declines Real-time alerts: Building alerts to notify when BINs are underperforming, so you can take appropriate actions such as Dynamic 3DS or Payment Flagging. The result? Acquirers who focus on implementing these fixes see 15-25% fewer unnecessary declines within as little as 60 days. Authorization optimization isn't just about approving more transactions; it's about intelligently managing risk while maximizing revenue per transaction attempt. P.S. During this summer, I have turned my newsletter into a Payments 4.0 Summer School, every week I will go deep, explaining the current trends and opportunities, providing the best frameworks and strategies. Subscribe here https://lnkd.in/etQJ2Tb5 to get it.

𝗣𝗮𝘆𝗺𝗲𝗻𝘁 𝗣𝗿𝗼𝗰𝗲𝘀𝘀𝗶𝗻𝗴 𝘃𝘀. 𝗔𝗴𝗴𝗿𝗲𝗴𝗮𝘁𝗶𝗼𝗻 𝘃𝘀. 𝗣𝗮𝘆𝗙𝗮𝗰 When businesses start accepting payments, depending on the use case they typically rely on processors, aggregators, or becoming a PayFac -- but what’s the difference, and which model is best for different use cases? Let's break it down ⤵️ 🔹𝗣𝗮𝘆𝗺𝗲𝗻𝘁 𝗣𝗿𝗼𝗰𝗲𝘀𝘀𝗼𝗿 → Connects businesses to acquiring banks and card networks (e.g., Fiserv, Chase, Adyen’s acquiring arm). Merchants get their own Merchant ID (MID) and handle their own risk management. 🔹𝗣𝗮𝘆𝗺𝗲𝗻𝘁 𝗔𝗴𝗴𝗿𝗲𝗴𝗮𝘁𝗼𝗿 → Works as a middle layer that allows businesses to process payments without their own MID. Aggregators (e.g., Stripe, PayPal, Square) manage compliance and risk but charge higher fees. 🔹𝗣𝗮𝘆𝗙𝗮𝗰 → A hybrid approach where a business becomes its own aggregator, onboarding sub-merchants directly (e.g., Shopify Payments, Toast). 𝗣𝗿𝗼𝘀 & 𝗖𝗼𝗻𝘀 𝗼𝗳 𝗘𝗮𝗰𝗵 𝗠𝗼𝗱𝗲𝗹 ▪️𝗣𝗿𝗼𝗰𝗲𝘀𝘀𝗼𝗿 → Lower costs, full control, but high setup complexity. ▪️𝗔𝗴𝗴𝗿𝗲𝗴𝗮𝘁𝗼𝗿 → Quick setup, less risk exposure, but higher and less flexible (or completely rigid) fees. ▪️𝗣𝗮𝘆𝗙𝗮𝗰 → More revenue potential, full branding, but complex compliance & underwriting. 𝗨𝘀𝗲 𝗖𝗮𝘀𝗲: 𝗦𝗮𝗮𝗦 𝗰𝗼𝗺𝗽𝗮𝗻𝘆 𝗹𝗮𝘂𝗻𝗰𝗵𝗶𝗻𝗴 𝗮 𝗺𝗮𝗿𝗸𝗲𝘁𝗽𝗹𝗮𝗰𝗲 𝗳𝗼𝗿 𝗱𝗶𝗴𝗶𝘁𝗮𝗹 𝘀𝗲𝗿𝘃𝗶𝗰𝗲𝘀 📌 𝗔𝘁 𝗹𝗮𝘂𝗻𝗰𝗵 → They start with Stripe’s aggregation model due to its quick onboarding and minimal compliance overhead. This allows them to scale rapidly without managing direct merchant accounts. 𝗚𝗿𝗼𝘄𝘁𝗵 𝗽𝗵𝗮𝘀𝗲 → As transaction volumes increase, they face higher processing fees and limited control over merchant onboarding. To optimize costs and gain flexibility, they transition to a PayFac model, enabling them to onboard sub-merchants directly, control risk management, and negotiate better rates. 𝗔𝘁 𝘀𝗰𝗮𝗹𝗲 → Once at the enterprise level, they seek further optimization by working directly with payment processors, giving them full control over payment flows, fraud prevention, and revenue margins. 𝗪𝗵𝘆 𝗜𝘁 𝗠𝗮𝘁𝘁𝗲𝗿𝘀 Choosing the right model impacts costs, compliance, and scalability. Businesses must evaluate ease of entry vs. long-term control when building their payment strategy. Which approach do you think is best for scaling businesses? Let’s discuss! Sources: Stripe, PayPro Global 🚨Follow Jason Heister for daily #Fintech and #Payments guides, technical breakdowns, and industry insights.

Accepting payments in 3 minutes feels convenient... Until you wake up and don't have access to your money. If you’re in eComm, SaaS, have recurring billing or are selling high-ticket offers… Those “click here and you’re approved in minutes” merchant accounts... Are like handing your drunk friend the car keys. Sure... maybe they’ll make it home fine. But statistically, it’s a massive liability. And when things go wrong? It’s usually catastrophic. Here’s why ⬇️ Platforms like Stripe, Klarna, Adyen and others: They don't really do underwriting. They let almost anyone in... And you're all in a pool together. Then Stripe handles the risk on the backend by closing accounts and holding funds. It's not good or bad, it's just how the business model works. But here's the b*tch... YOUR business doesn't even need to do anything wrong to have an issue. When of YOUR COMPETITORS does something that causes a review; A spike in chargebacks, a fast-growth month, an aggressive marketing campaign, And your industry or business model as a whole is impacted. We get 3-5 businesses a day that are having money held by Stripe or some other provider. Business lose the ability to payments for weeks. And can be without big chunks of cash for months when this happens. How long could YOUR business survive without cash flow? To pay staff?  Fulfill orders?  Keep ads running? The frustrating part? It’s avoidable. Here’s how to protect yourself: 1. Get fully underwritten upfront ↳ Share your actual business model, marketing, and fulfillment processes. ↳ Work with a provider who understands your industry’s risk profile. 2. Diversify your processing ↳ Have multiple merchant accounts with smart routing. ↳ Avoid a single point of failure that can take you down overnight. (hint: Easy Pay Direct can set all of that up for you) 3. Know your risk triggers ↳ Track refund rates, chargebacks, and industry compliance. ↳ Stay ahead of red flags that processors use to shut accounts down. Some shortcuts in business are fine. This isn’t one of them. Ever been burned by an instant-approval platform? ♻ Share this if you know a founder who needs to hear it.  And follow me, Brad Weimert, for more.

We've been using the message 'we do it for you' to describe our role as a Merchant of Record (MoR) and what we do for our customers. It's actually a pretty staggering list - and it makes you realise just how complex the business of selling software online around the world can be. There's a huge amount of operational admin entrepreneurs have to take on when they embark on scaling globally - a lot of which they possibly didn't foresee when they started out. → Merchant accounts 
Setting up multiple merchant bank accounts in the countries where you have a substantial customer base
 → Payment and data compliance Managing payment card security (PCI-DSS) and upholding relevant data requirements in the locations you sell to → Local entity creation
 Establishing local business entities to facilitate merchant accounts, tax registration, payment relationships, and so on → Currency conversion
 Managing the conversion of payments made in foreign currencies → Payment failure rates
 Integrating and maintaining multiple B2B payment processors or payment service providers to facilitate payment routing and cascading, to mitigate the chance of payments being mistakenly declined as fraudulent, causing lost revenue
 → Payment processor fees Negotiating and managing all credit and debit card fees
 → Fraud offenses Creating logic to flag fraudulent orders, and then manually reviewing those suspicious orders, refining your custom rules 
 → Disputes and refunds Handling payment reconciliation, refunds, and chargebacks
 → Sales tax Calculating, filing, and remitting software sales tax in the locations where your customers are When we say 'we do it' - we mean actually manage it all for you, not provide the tools for you to do it yourself. Doing it yourself can involve several teams of people and a lot of time, not to mention the risk of getting it wrong.

What kind of monthly analysis should you be doing for your acquiring BIN to identify and prevent profit leaks? Here’s the high level: ➡️ Identify under performing relationships ➡️ Quantify unexpected expenses. Recuperate to the extent you can and try to eliminate any unnecessary recurring charges moving forward. Here are some of the ways I do it: ✔️ Track profitability for each of your relationships. This requires knowing your actual cost at this level, then deducting residual payouts. ✔️ Analyze processing bills on a monthly basis. Track monthly trends for individual item codes. Verify anything that is billed by count and volume with source data. ✔️ Analyze card brand bills on a monthly basis. Track monthly trends for individual item codes. Identify any unusual or new items. Look for items that are specific to merchants (arbitration fees or fines, for example) and ensure they are getting passed through to merchants. ✔️ Compare what you were billed by the card brands to what you billed out. Do this for both interchange and dues/assessments. ✔️ For anything billed at the merchant level, ensure you aren’t paying for closed merchants. Do you want to pay account on file fees to processors or gateways for merchants who aren’t bringing in any revenue? I didn’t think so. Some of this might not be possible on a monthly basis based on available resources. In that case, spot checking different things each month can go a long way. There are also tools in the marketplace that can assist in your analysis. Create a system, stay disciplined about sticking to it, and trust me when I say you’ll be heads and shoulders above your #payments peers. And you’ll also love the extra money you find that goes straight to your bottom line. 🙌