Account Updater Overview
Updated card-on-file information can be the difference between a successful transaction and a repeat buyer, or a failed one and a poor user experience. Accessing card updates in real-time not only benefits merchants and service providers but also plays a crucial role in improving customer satisfaction. It allows for customization in applying updates, be it on-demand, continuous, or a combination of the two. This is critical for payments optimization and driving revenue growth, but it also ensures a positive customer experience.
The “Real-Time” Factor
VGS is one of the only tokenization platforms in the world to build a direct integration to Visa and Mastercard, which keeps it competitive on both pricing and data accuracy. By utilizing direct network API-based integration to get the latest updates in real time, VGS surpasses the industry standard of outdated batch file-based methods.
Token Service Providers (TSPs) without direct card network integration rely on more lengthy, manual means of requesting and obtaining updated card information. The requests for batch-file card updates take up to five business days while risking multiple points of failure between the merchant, TSP, and card network. Depending on card network update intervals and the processing times of all parties involved, a merchant or biller may not receive updated card-on-file information for up to a week after a card has expired or been reissued. The delayed delivery of account updates lowers the utility of the updated data for merchants and service providers, ultimately negatively impacting the buyer experience for their customers.
Customizable “Real-Time” Card Updates
Real-time account updates are even more valuable when merchants can customize when, where, and how often they apply them for the most efficient, cost-effective approach. With VGS Account Updater, merchants can leverage real-time card updates on-demand, continuously, or a combination of both.
On-Demand Account Updates
Merchants can choose where and when to use on-demand account updates for use cases like:
1
Immediate Transaction Needs
When a payment attempt fails due to outdated card information, real-time account updater services can instantly retrieve the latest card details. This is particularly useful for high-value transactions where updated information in real-time can make a significant impact on revenue.
2
Low Transaction Volume or Frequency
Merchants with lower transaction volumes or those not requiring immediate card updates can benefit from the periodic updates provided by an on-demand service designed to update information when needed.
3
Initial Subscription Enrollment
For new subscription sign-ups, ensuring that follow-up recurring payments - after adding card information for the first - go through smoothly is critical to the customer's future relationship with the service.
4
Near-Term Subscription Renewals
If a subscription renewal is coming up in a few weeks, merchants can update their card information on file in advance. This is more cost-effective than paying to keep it constantly updated even when a charge isn't imminent.
Continuous Account Updates
In 2022, 40% of card holders replaced their cards. Given that a typical card expires every four years, it's safe to assume that 25% of cardholders update a card each year. That's a lot of expired cards and a lot of outdated card-on-file information.
Requiring customers to manually re-enter card information risks friction, poor user experience, and loss in sales. Real-time, continuous account updates resolve this problem by eliminating customer intervention. That said, continuous updates shouldn't be unilaterally applied. These updates are best leveraged for merchants with:
1
High-Frequency Usage & Recurring Transactions
For businesses supporting frequent, recurring transactions (i.e., demand-based services like ride-sharing and grocery delivery or in-app purchases for gaming), continuous updates help ensure saved payment methods are kept current for time-sensitive needs.
2
Long-Term Customer Relationships
For businesses that rely on long-term customer relationships and repeat purchases (e.g., e-commerce, online marketplaces), periodic account updates ensure uninterrupted service and seamless recurring billing.
Knowing When to Use On-Demand and Continuous Updates
1
Hybrid Business Models
Businesses that mix high-frequency and subscription-based transactions can leverage both services to cover all bases. For instance, a platform offering both one-time purchases and subscription services can use continuous updates for ongoing transactions and on-demand updates for recurring billing.
2
Strategic Cost Management
To keep costs low, use on-demand lifecycle updates at preset frequency rates and deploy continuous updates to transactions strategically based on dollar amount or urgency. This approach balances the need for immediate updates with cost-effectiveness.
3
Enhanced Customer Segmentation
Identify and segment customers based on their transaction behaviors. High-value or frequent customers can be served with continuous updates, while others can be managed with on-demand updates throughout their lifecycle.
Summary
Merchants can significantly improve their payment processes by strategically implementing a real-time account updater solution that works across card networks and payment processors and supports both on-demand and continuous card updates. By understanding where each method should be used and how to combine both methods effectively, businesses can increase authorization rates, improve customer satisfaction, and consolidate vendor service costs.
Customize Your Card Updater Solution
Embracing a tailored approach to real-time account updates ensures that card-on-file information remains current, fostering smoother payment experiences for revenue growth and business expansion.
Contact UsLearn more about VGS Account Updater solutions for both merchants and payment enablers.
If you're looking to implement an account updater solution for the first time or are seeking a more strategic, configurable solution, VGS has you covered.
