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Plan B for When a Payment Gateway is Down

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Last editedJan 20232 min read

Payment gateways are a boon for small businesses, taking care of logistics so that you can accept payments from customers quickly and securely. Most of the time, you can set up your payment gateway and forget about it. But what happens when a payment gateway is down? You’ll need a plan B. Here’s what you can do in the event of an outage or other technical issue.

Why do you need a backup plan when a payment gateway is down?

Although payment gateway outages are uncommon, they do happen from time to time. If your business relies on a single gateway like Stripe or PayPal, an outage can result in lost sales when customers can’t complete their purchases. Unfortunately, they’re unlikely to return to complete the transaction later when the gateway’s fixed. Instead, they’ll turn to a competitor that uses a different payment gateway.

In a worst-case scenario, outages can also cause your brand’s reputation to take a hit. If your payment gateway goes down during a sale, for example, you’ll end up with a full inbox and social media feeds filled with complaints.

Plan B: multiple payment gateways

A clear solution is to use multiple payment gateways. This offers a proactive solution and built-in backup plan to the use of a payment gateway outage. When one system crashes, customers are automatically routed into another. At the same time, this gives you a backup of customer data, so you don’t lose all of their payment details.

There are additional benefits to using more than one payment gateway in Australia. Some consumers prefer paying by card, while others prefer alternative payment methods like digital wallets and cryptocurrency. Multiplying your gateways provides them with more options at checkout. Similarly, you’ll be able to branch out into multiple countries by accepting payment in multiple currencies with each gateway.

The downside of multiple payment gateways

It’s clear that there are many benefits to having a backup plan, but is there a downside to using multiple payment gateways? The primary downside is the higher cost. Each gateway comes with its own set of fees, contracts, terms, and conditions. You’ll need to pay different processing fees and membership dues for each, which can be tiresome to keep track of. You’ll also need to hold merchant accounts for each gateway to settle customer payments before they’re transferred to your business account.

Another factor to keep in mind is that maintaining multiple payment gateways involves the need to process data from a wider range of sources. You’ll need robust systems in place to manage and analyse all your transaction data for decision making.

How to reduce failed payments

Payment failures aren’t always due to a widespread outage, and in fact the causes are usually far more mundane. Sometimes, your customer will try to complete the transaction only for it to be declined. This can occur for myriad reasons. The following are a few examples:

  • Payment gateway down

  • Card details have expired

  • Card details were entered incorrectly

  • Insufficient account funds

  • Transaction flagged for fraud

Aside from offering a variety of different payment methods, you can safeguard against failed payments with an intelligent retries solution. With GoCardless’ Success+ feature, businesses can recover an average of 70% of failed payments on the second try. The solution uses payment intelligence to retry the payment at the best possible time, reducing unintentional churn while improving cash flow.

Ultimately, providing a combination of intelligent automation and multiple payment gateways helps mitigate the risk of outages and failure. It’s best to shop around to find gateways that suit your budget, customer needs, and geographic location.

We can help

GoCardless is a global payments solution that helps you automate payment collection, cutting down on the amount of financial admin your team needs to deal with. Find out how GoCardless can help you with one-off or recurring payments.

Over 70,000 businesses use GoCardless to get paid on time. Learn more about how you can improve payment processing at your business today.

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