5 Benefits of Credit Card Account Updater for Merchants and Customers
Today’s consumers appreciate the convenience of saving their payment methods electronically. They do this through automatic payment options for goods, services, or nonprofit donations billed on a recurring basis. But the drawback of being able to “set it and forget it” is that they often forget to update their information when something changes. Vaulted information pertaining to credit cards changes frequently for a variety of reasons:
- Card expiration dates
- Cards replaced when lost or stolen
- Cards reissued for technology upgrades or in response to security breaches
- Changes to name or billing address
- Account closures
With the Account Updater (AU) feature, major card issuers automatically provide the latest card information directly to your payment gateway. Account Updater benefits both the merchant and the customer. Here’s how it creates a more seamless relationship:
1. Maintains Accurate Account Information
Transactions attempted with outdated or invalid information will be declined. This cuts into profits because you’re still paying authorization fees even when transactions don’t go through. Account Updater helps reduce card-not-present (CNP) transaction declines and increases authorization approval rates.
2. Reduces Interrupted Bill Payments
If you provide goods or services on a recurring basis, you’re counting on a certain amount of revenue to come in with every billing cycle. When these payments are interrupted, your cash flow suffers. By some estimates, subscription-based businesses can expect to lose up to 5-10% of their business annually as a result of outdated credit card information, and as many as 25-30% of your recurring transactions can be declined per billing period. Not only are you paying extra transaction fees for declines, you’re also paying for the time and the labor costs associated with the manual process of obtaining corrected information. Account Updater reduces these hassles and helps you maintain a steady revenue stream.
3. Avoids Service Interruption
Customers can experience serious consequences when transactions are declined for invalid information, including fees charged for late or missed payments and canceled service. Account Updater reduces payment delinquencies and ensures that customers will continue to receive their expected goods or services. Plus, automatically updating card information encourages customers to continue a subscription or service without thinking twice about it.
4. Creates a Frictionless Customer Experience
Cards expire and change regularly but many customers don’t remember to update their account information with all of the various vendors where their payment information is saved. Account Updater gives them the extra convenience of updating their information with many service providers automatically. On the merchant’s side, no business owner wants to tell a customer that their card was declined, that their subscription has been canceled for non-payment, or they have incurred late fees. Merchants can avoid those negative interactions and ensure that payment data is always accurate by implementing Account Updater through OmniFund.
5. Boosts Sales and Customer Retention
Fewer service disruptions result in better experiences which encourage customers to continue their services or subscriptions. Keeping existing customers is significantly more cost-effective than pursuing new ones—profits rise with customer retention. Your sales and customer service reps can also focus more on upselling and bringing in new revenue rather than chasing down updated payment information.
Peace of mind regarding the protection of their financial data also helps with customer retention. Using tokenization in conjunction with Account Updater not only reduces the risk of failed transactions but also adds security.
Account Updater is just one of many features in the Payments as a Platform® solution offered by OmniFund. We’ve been providing advanced payment technologies backed by expert, personalized support since 1997. For more information on how OmniFund can simplify your payment processes and help your business grow, request a demo today.
