Riskified, the leading fraud-prevention solutions provider, today announced the launch of the latest version of Deco, a real-time solution for recovering orders lost to card-not-present payment authorization failures. As many as one in seven attempted eCommerce transactions fail payment authorization, according to The Economist, leading to lost revenue and upset customers. Deco converts up to 20% of those declined transactions into immediate sales, delivering a significant ROI to merchants and boosting customer satisfaction.
Payments need to be authorized by multiple financial institutions in order to be successfully completed. Many of these institutions have not kept pace with the rapid changes in online shopping and consumers’ purchasing behavior, making payment authorizations an especially hard challenge for eCommerce merchants. According to Riskified’s research, as many as 72% of online shoppers whose payments fail authorization are actually legitimate customers who should have been approved.
Merchants have traditionally been unable to affect payment authorization failures as the process happens outside of their systems. Deco is a fast payment option that was created to address authorization failures in a novel manner. Immediately after a payment failure, eligible shoppers receive a pop-up that simply asks consumers to re-enter their credit card details. Without any credit checks, additional fees, or applications, Deco completes the payment on the shoppers’ behalf.
Deco leverages Riskified’s AI-powered decisioning platform and the breadth of our merchant network to identify the legitimacy of the shopper behind the transaction. Once confirmed as legitimate in real-time, the transaction is submitted for payment authorization.
“By using Deco, merchants can recover significant amounts of revenue that would otherwise have been needlessly declined while also gaining a cohort of loyal, repeat customers,” said Eido Gal, CEO of Riskified. “We believe that Deco represents a key step forward for merchants looking to address the challenge of payment authorization failures.”
The Level Group’s Success with Deco
One of The Level Group’s partners, a luxury European fashion brand with significant U.S. sales volumes, was suffering from significant decline rates as do non-U.S. merchants using non-American acquirers. High U.S. credit card decline rates are a perfect storm of outdated, unwieldy payment infrastructure failing to accurately measure and manage the risk of cross-border eCommerce. As common as this pain point is for international expansion, merchants like this brand struggle to proactively convert these authorization failures at point of decline, and deliver the premier customer checkout experience of their design.
Once partnering with Deco, the brand has recovered 9.62% of Deco-eligible US credit card payments annually, and saw more than half of its Deco users double their spend on return shopping trips.
“High authorization failure rates are a common pain point in cross-border sales, especially for non-US merchants that have growing US sales volumes,“ said Andrea Ciccoli, CEO and co-founder of The Level Group. “It’s an even bigger pain point for brands with high average order values, and Riskified allows these merchants to not be beholden to the built-in payment difficulties of cross-border eCommerce.”