Payment Orchestration is the consolidation of different payment services into a single platform. By doing this, merchants can route their transactions more easily according to particular rules and conditions.
A Payment Orchestration Platform can handle all aspects of the payment process. This includes the acceptance of customers by offering them the best payment methods (routing) along with cascading, which allows for different methods to be considered if the first one fails.
As everything is in a single centralized dashboard, Payment Orchestration Platforms also allow in-depth analytics, while reconciliation tools can be used to ensure smooth payment flows by facilitating operations.
Payment processing, particularly when involving multiple jurisdictions, is becoming increasingly complex and Payment Orchestration alleviates some of these issues.
How Payment Orchestration Works
1. A customer makes a purchase.
2. The customer chooses a payment method and inputs their details in the payment gateway.
3. The customer’s payment information is encrypted by the gateway. This is then sent via the payment processor to the acquiring bank.
4. When the data is received by the acquiring bank, it communicates with the issuing bank so the payment can be verified.
5. Normally, the acquiring bank will send acceptance or failure information to the payment gateway and merchant. However, with payment orchestration, the platform chooses another method instead when a payment fails. This re-routing to another payment processor reduces the number of failed transactions and leads to more satisfied customers. The whole process is automatic.
6. This continues until either the payment is approved, or a hard decline is reached.
The Main Benefits of Payment Orchestration
There are many benefits to payment orchestration, particularly if you are looking to expand globally. These include:
Increased Revenue – By reducing the number of payment failures, revenue increases. Payment Orchestration also simplifies the process, resulting in happier and less frustrated customers.
Reduced Costs – As Payment Orchestration automates the process, costs are also reduced. Transactions can also be routed through the channels that offer the lowest fees. As Payment Orchestration platforms work with many payment providers, this enables operators to enjoy better terms and conditions too.
Integrated Dashboard – Most platforms allow all payment processes to be seen in a single dashboard. Data can then be easily analyzed and inefficiencies discovered, thus highlighting potential cost savings.
Analytics and Real-Time Reporting – Payment trends, customer activity, and potential fraud can be accessed in real-time, enabling smarter and more efficient business decisions. In high-volume and high-risk industries, fraudulent behavior can be spotted more easily.
Smart Routing and Cascading – As discussed, payments can be routed through the most effective option. If this fails, cascading allows other routes to be considered. This reduces the chance of failed transactions. Another advantage of cascading is it promotes increased acceptance rates, which is particularly important when looking to attract new customers and retain existing ones.
Easy Integration with More Options – Payment Orchestration Platforms offer a wide range of pre-approved payment methods. The same applies to PayLab, where new Payment Service Providers are added on a regular basis. This gives operators greater flexibility, with new providers easily added through a single API. This is particularly ideal for companies looking to expand into new territories as access to the required payment options is made through one simple integration.
Conclusion
Adding a Payment Orchestration platform to your eCommerce site is a must, particularly if you are looking to expand internationally. PayLab has everything you need all under one roof.
If you are interested in finding out more, our 30-minute demo has all of the answers. Get in touch with our dedicated team today.
