Key Multi-Acquiring Strategies for Unlocking Payment Processing Potential | CatalystPay

Key Multi-Acquiring Strategies for Unlocking Payment Processing Potential

  • 11 min read
  • 24 january 2025

For eCommerce merchants, ensuring smooth payment processing is essential to maintaining customer trust and maximizing sales. Multi-acquiring strategies such as Smart Retry, BIN Dispatching, and Channel Dispatching provide a robust framework to tackle payment challenges while optimizing operations In this guide, we break down these strategies, explain their applications, and explore how they address common payment issues with real-world examples. 

 

And before we deep dive, let’s revisit:

What is a Multi-Acquiring Strategy?

A multi-acquiring strategy connects businesses to multiple acquiring banks or financial institutions to process payments. Instead of relying on a single acquirer, this approach offers flexibility, reduces risks, and enhances performance by leveraging the strengths of various acquirers. It allows merchants to dynamically route transactions, lower costs, and maintain operational resilience in a global, competitive market.

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multi-acquiring strategy

How Does It Relate to Payment Orchestration?

You might wonder, “Isn’t this payment orchestration?” In essence, yes. Payment orchestration serves as the framework within which multi-acquiring strategies operate. It centralizes and manages payment processes, integrating gateways, acquirers, and fraud prevention tools to streamline operations.

While multi-acquiring connects businesses to multiple acquirers, orchestration ensures these connections are managed efficiently. Strategies like Smart Retry, BIN Dispatching, and Channel Dispatching are tools within orchestration that optimize transactions, reduce costs, and enhance approval rates. Together, they form a seamless and robust payment ecosystem.

Key Multi-Acquiring Strategies Explained

In payment processing, various terminologies like "Smart Retry," "BIN Dispatching,", "Channel Dispatching", “Cascading” and “Routing” are used, but the underlying goal is consistent: to ensure every transaction is optimized for the highest possible success rate. Each strategy tackles a specific aspect of the payment journey, addressing potential challenges and aligning with a merchant’s unique needs. Let’s explore these strategies and how they work to maximize efficiency and minimize revenue loss.

 

1. Smart Retry: Recovering Declined Transactions

Smart Retry is a reactive mechanism designed to recover transactions that fail due to temporary issues, such as network timeouts or authentication challenges. It automatically retries these payments with fallback acquirers, increasing the likelihood of success without requiring any action from the customer. 

Smart Retry is often associated with terms like "cascading" or "dynamic retrying," but it is more nuanced. While cascading retries failed transactions with fallback acquirers, Smart Retry dynamically analyzes decline reasons, ensuring retries are routed intelligently to maximize success. It complements proactive routing strategies, such as BIN Dispatching, by providing a safety net for transactions that fail despite initial optimization.

Scenario:
During a flash sale, a customer’s payment fails because the acquirer experiences a timeout. Smart Retry detects the issue and reroutes the transaction to a secondary acquirer, allowing the payment to be processed successfully.

2. BIN Dispatching: Optimizing Costs and Approval Rates

BIN Dispatching proactively routes transactions based on the Bank Identification Number (BIN) of the customer’s card. By analyzing the first digits of the card, merchants can direct payments to acquirers that specialize in certain card types, regions, or transaction profiles, ensuring the highest approval rates and lowest fees.

While BIN Dispatching is sometimes confused with routing in Smart Retry, it’s fundamentally a proactive strategy applied before the first transaction attempt. It ensures the best conditions for success upfront, whereas Smart Retry is reactive, stepping in only when a transaction is declined. Together, they create a robust payment flow that optimizes both the first attempt and fallback scenarios.

Scenario:
A global retailer notices that cards issued in Asia have higher approval rates when processed through a specific acquirer with regional expertise. By routing these transactions accordingly, the retailer reduces declines and minimizes cross-border fees.

3. Channel Dispatching: Customizing Payment Flows

Channel Dispatching takes a more granular approach by directing transactions to specific acquirers based on various criteria, such as customer behavior, geographic location, or transaction volume. This strategy enables merchants to balance loads, conduct performance testing, or cater to specific customer preferences.

Channel Dispatching is similar to BIN Dispatching in its proactive nature, but the criteria for routing extend beyond card attributes. It allows businesses to refine their payment strategies by balancing traffic or tailoring flows to specific operational goals. When combined with Smart Retry, it ensures that both primary and fallback routing are optimized for maximum efficiency.

Scenario:
During a promotional event, a merchant routes 70% of transactions to Acquirer A, known for its reliability during high-volume periods, while sending the remaining 30% to Acquirer B to test its performance. This setup ensures uninterrupted service while gathering valuable data for future routing decisions.

Overview of Orchestration/Multi-Acquiring Strategies:

Orchestration Strategy

Description

When to Use

Smart Retry

Retries failed transactions with fallback acquirers

High failure rates due to temporary issues or high-risk decline

BIN Dispatching

Routes transactions based on card BIN

Optimize approval rates for specific card types and regions

Channel Dispatching

Distributes transactions based on criteria or percentages

Balance loads, A/B test acquirers, or tailor routing to attributes

Integrating Strategies for Optimal Payment Performance

The key to success lies in understanding how these strategies—Smart Retry, BIN Dispatching, and Channel Dispatching—work together. BIN Dispatching and Channel Dispatching focus on optimizing transactions before the first attempt, setting the stage for higher success rates. Smart Retry acts as a safety net, ensuring that any failed payments are intelligently rerouted for recovery.

By combining these strategies within a multi-acquiring setup, merchants can create a payment framework that not only reduces declines but also minimizes costs and delivers a seamless customer experience.

For instance:

Combined Strategy

Description

When to Use

BIN Dispatching + Smart Retry

Optimized routing with fallback

Need optimized routing and a safety net for failure

Channel Dispatching + Smart Retry

Balances loads and retries failed transactions

Balance load and ensure high success rate

Channel + BIN Dispatching

Targeted routing with cost efficiency

Optimize costs and approval rates

Comprehensive Strategy

Integrates all methods for optimization

Need robust setup for managing costs, risks, and success rates

 

These combinations allow merchants to create a robust, flexible payment framework tailored to their unique needs.

Considerations for Implementing a Multi-Acquiring Strategy

Implementing a multi-acquiring strategy involves more than connecting to multiple acquirers—it requires a thoughtful approach to ensure efficiency and effectiveness. Here’s what to focus on:

  • Infrastructure: A capable gateway is essential for dynamic routing, cascading, and real-time monitoring. Ensure it integrates seamlessly with your existing systems.
  • Compliance and Security: Adherence to PCI DSS, PSD2, and SCA requirements is critical, as is robust fraud prevention to protect sensitive data.
  • Data Insights: Access detailed analytics to refine routing strategies, monitor acquirer performance, and address declines intelligently.
  • Cost Management: Monitor fees and strike a balance between maximizing recovery and controlling retry costs.
  • Regional Expertise: Partner with acquirers specializing in local payment methods for better approval rates and customer experiences.

How CatalystPay Supports Multi-Acquiring Strategy

CatalystPay simplifies multi-acquiring with a robust gateway that supports Smart Retry, BIN Dispatching, and Channel Dispatching, offering dynamic routing and advanced reporting. Our built-in fraud prevention tools and dedicated Risk and Compliance team ensure secure transactions and optimized performance. With partnerships across 30+ global acquirers, we provide the flexibility, coverage, and expertise to power a scalable and efficient payment strategy.

Conclusion: Future-Proof Your Payments

A strong multi-acquiring strategy, powered by payment orchestration, helps businesses optimize transactions, recover declines, and expand globally. By implementing Smart Retry, BIN Dispatching, and Channel Dispatching, you can create a resilient and efficient payment system that drives growth and enhances customer satisfaction. With the right tools and partners, your payment operations can become a powerful asset for success.

Contact CatalystPay today to discover how we can help you achieve payment success.

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