Acquirer Processor Transaction Optimization
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Solution Overview
Problem
Conventional electronic transaction processing methods often fail to consider various factors that affect transaction conversion rates, leading to declined transactions and undesirable outcomes for merchants and account holders.
Innovation Solution
A computer-implemented method and system that retrieve and analyze payment transaction parameters and authorization results from past transactions to generate authorization success factors, which are then used to modify transaction parameters and improve the chances of successful authorization by submitting optimized transactions to a financial institution.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Productivity
If conventional methods submit transactions according to acquirer processor or merchant specific factors, then the submission process is simple, but transaction conversion rate is low
Solution Approach 1:
The system performs preliminary analysis of historical transaction data before submitting new transactions. By pre-processing past transactions to identify success factors and parameter patterns, the system prepares optimization rules in advance that are applied to incoming transactions, thereby improving conversion rates without adding complexity to the real-time submission process
Solution Approach 2:
The system implements a feedback mechanism where authorization results from past transactions are analyzed to generate success factors. These feedback insights are continuously applied to modify and optimize subsequent transaction parameters, creating a closed-loop system that improves conversion rates through learned patterns while maintaining manageable complexity through automated feedback processing
2Reliability
If transaction parameters are modified based on historical analysis, then authorization success rate increases, but processing time increases
Solution Approach 1:
The system performs parameter optimization in advance by analyzing historical data and pre-determining successful parameter combinations. When a new transaction arrives, the system quickly applies pre-computed optimization rules rather than performing full analysis in real-time, thus improving authorization success rate while minimizing additional processing time
Solution Approach 2:
The system identifies and modifies only the critical parameters that have the greatest impact on authorization success, rather than reprocessing all transaction parameters. By focusing changes on key factors like billing address format, CVV requirements, and merchant categorization code selection, the system improves success rates with minimal processing overhead
Data Source
AI summary
A method for optimizing transaction authorization conversion rates includes retrieving payment transaction parameters and authorization results for a plurality of past payment transactions, generating authorization success factors for each of a plurality of payment transaction parameters based on the retrieved payment transaction parameters and authorization results, receiving, at an acquirer processor, a payment transaction from a merchant, modifying one or more parameters of the payment transaction according to the generated authorization success factors, and submitting the modified payment transaction to a financial institution for processing.