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There are many common reasons behind soft declines and hard declines. Many payment declines result from the fact that either expiration date or credit card number specified during the initial transaction submission is invalid. Respective transaction decline codes (“invalid expiration date” or “invalid credit card number”) are generated by the host payment system. In case of “invalid card number” the specific reason behind the decline must be verified with the cardholder. “Invalid expiration date” response means that either the card really expired, or the expiration date specified during transaction submission and the expiration date on the card are not the same.
In some cases usage of recurring indicator might increase approval rates. A recurring indicator is a special ‘flag’, which marks the transaction as a recurring one. If a processed transaction is a recurring one, it should be marked with a recurring indicator. If a recurring transaction is marked with the indicator, most issuers might still approve it even if cardaccount expiration date is in the past. In other words, if during some billing period the ‘invalid expiration date’ response is received by the submitter, but it is recorded that recurring payments from the card were successfully coming through during previous recurrence periods (there is a previous processing history), the transaction, bearing the ‘recurring’ indicator, might still be processed.
Another way to reduce transaction decline rate is account updater mechanism. Account updater is a service offered by issuing banks through acquirers, which allows to get updated information on a particular card of the issuer. The information can include updated holder name (if there’s been a name change), updated expiration date, updated account number (if account number has been changed due to fraud, or because card has been loststolen). Account updater is a handy tool in recurring billing environment, where usage of the most up-to-date payment information can eliminate potential declines caused by invalid card numbers, or expired credit cards.
More information on account updater mechanism can be found in the respective article on this blog.
