Failed payments are especially serious matters for startups and small- to medium-sized enterprises (SMEs) based in the Philippines. If they happen frequently enough, they can significantly bring down revenues and hurt the overall customer experience, making it especially difficult to grow sustainably.
Unfortunately, failed payments are extremely commonplace. According to a , about 60% of all business organizations reported losing customers over failed payments. The same study showed that businesses in the Asia-Pacific (APAC) lost USD 43.7 billion due to payment failures.
To maintain customer trust and mitigate revenue losses, Philippine-based SMEs and startups need to understand the most common causes behind these damaging payment failures. Let’s look at 22 reasons a customer may not be able to get their online payment processed:
1) Online Payments Gateway Is Not Set Up Correctly
Incorrect configurations in your online payment solutions can prevent successful transactions from taking place. Using well-designed internet payment solutions like Maya Checkout can minimize setup issues and ensure hassle-free online payment processing.
2) Technical Glitches
Online payments involve several steps and multiple parties, each with its own hardware and software, resulting in multiple potential failure points. While you can do little about glitches originating from card companies, customers, and internet service providers, you can mitigate the risk of glitches coming from your end.
To minimize the odds of glitches, first, choose well-supported platforms with active developer communities like Shopify, WooCommerce, or Magento for your e-commerce site’s technology framework. Next, be sure to use payment plugins from a reputable online payment processing company like Maya. Maya Plugins let you create a reliable third-party payment gateway that your Shopify or WooCommerce shops needs to accept payments with ease.
3) Network Connectivity Problems
Poor network connectivity during the payment process can cause transaction failures. This is an especially common problem in the Philippines, particularly in areas with underdeveloped digital infrastructure.
4) Payment Method Not Supported or Blocked by Payment Gateway
Some online payment platforms may not support certain types of cards or may have blocked specific payment instruments. To maximize the number of payment methods available, choose an online payment processing service trusted by startups and SMEs.
5) Transaction Is Blocked by Merchant Account
In some cases, merchant accounts might get flagged or blocked due to issues like suspicious activities or non-compliance.
6) Processor Declined
The payment processor, which facilitates transactions between the merchant and the acquiring bank, may also decline a transaction for various reasons.
7) The Primary Cardholder Deactivated an Additional User
If a customer has added another user to their credit card account and subsequently deactivated them, payments from that user's card might fail.
8) The Payment Card Is Expired
Payments attempted with expired credit, debit, and virtual payment cards will fail.
9) Not Enough Credit
Insufficient available credit on a customer's credit card can result in failed transactions, even if the card is not maxed out.
10) Insufficient Funds
Similarly, when the customer’s e-wallet or bank account lacks enough funds to cover the payment amount, the transaction will fail.
11) Fraud Alert
If a payment triggers an automated fraud alert, the card or e-wallet issuer may block the transaction to protect the account holder. Likewise, if the customer's account has been associated with fraudulent activities in the past, future transactions may be declined.
12) Card Has Been Canceled
Customers with multiple credit cards may fail to keep track of which ones are active and mistakenly offer a canceled card for transactions.
13) Card Reported Lost/Stolen
Stolen or lost credit cards that are called in are usually blocked by the issuing provider, preventing any further transactions.
14) Card Terms Have Changed
If the terms and conditions of the card have been modified, the payment may be declined.
15) Credit Limit Has Been Maxed Out
Maxed-out credit cards cannot be used for further transactions until the balance is cleared.
16) Incorrectly Entered Information
Simple human errors like typos in card details or billing information can lead to payment failures. Mistyped card numbers, expiration dates, and CVVs are particularly common reasons for payment failures.
17) Invalid Address
A mismatch between the provided billing address and the cardholder's registered address can trigger anti-fraud systems and lead to failed payments.
18) Account Has Been Closed
If the customer's bank or e-wallet account is closed, payments cannot be processed. This error can happen if the customer failed to update their bank or e-wallet information on their e-commerce site account.
19) Account Is Suspended
If the customer's account is suspended or frozen, any payment attempts will be unsuccessful. This can happen for a number of reasons, including terms of use violations, being the target of international sanctions, and court orders, to name a few.
20) Payment Is Past Due
In cases where the customer has unpaid dues or outstanding payments, the new transaction may be flagged and subsequently declined.
21) Payment Collection Failed
Glitches, regular system maintenance, and other issues with payment collection mechanisms or direct debits can lead to failed transactions.
22) Purchase Made While Traveling
Unusual transactions made from foreign locations might be considered suspicious and declined.
Raise Revenues and Create Happy Customers with Maya Business
Offering hassle-free online payment processing helps your e-commerce store turn in robust revenues and allows it to deliver a superior customer experience. With their simplicity and reliability, Maya Business solutions like Maya Checkout and Maya Plugins are widely considered to be the best online payment processing solutions for Philippine-based startups and SMEs. Create a Maya Business account today to begin accepting a full range of online payments on your e-commerce storefront.
To take your business further, sign up for Maya 1-2-3 Grow bundle. 1-2-3 Grow lets you save on QR Ph payment processing with a low 1% merchant discount rate (MDR) for 3 months. Open a Maya Deposit account and use it for Maya payment settlements to enjoy an extra month of 1% MDR for four months of savings. You’ll also qualify for a no-collateral Flexi Loan offer of up to PHP 2 million in just 3 months, giving you the funds you need to further improve your e-commerce store’s checkout processes. Start offering a truly frictionless online shopping experience with Maya Business solutions.
