Over the past few years, the credit card processing market in Brazil has changed significantly. Fortunately, the changes have encouraged the entry of new competitors and better regulation. The acquiring market was originally limited to Cielo and Rede’s operation. In this context, each acquirer enjoyed exclusive contracts with determined credit card labels, for example: Visa labelled cards could only be captured by Cielo, whilst Rede had the exclusivity on the capture of MasterCard cards.
However, in 2010, the Brazilian Central Bank and the Administrative Council of Economic Defence proclaimed the opening of the acquiring market. Consequently, Cielo and Rede began accepting the main card labels, only maintaining their exclusivity on some brands. This opening up of the market also made the emergence of new acquirers possible. The door was opened to other companies, such as Elavon and Stone. In addition, moving towards a full-opening model, in September 2015 it was announced the end of exclusivity contracts between credit card labels and acquirers. From then on, companies would have 180 days to adapt to the new regulation, although this deadline has been extended several times and is not fully enforced yet. As examples of exclusivity agreements, American Express and Elo cards could only be processed by Cielo and, in the same way, HiperCard maintained exclusivity with Rede.
What is a Multi Acquirer Reattempt for Online Payments?
The concept of a multi acquirer reattempt is based on a new attempt of charge after receiving a payment failure notification. The first charge can fail for several reasons, from a connection error with the bank or the acquirer, to an Internet connection error on the buyer’s side or wrong card number inserted on the payment form as some examples. When the payment failure notification is received, the gateway API can send the payment order to a second acquirer.
The whole process takes place in the back-end of the online store and it doesn’t require any action from the buyer. In fact, buyers don’t even notice that the payment processor is configured in this way. With this simple configuration, the merchant avoids having customers leaving the page without completing the payment. This would be the payment flow:
PagBrasil’s system allows merchants to define their preferences and priorities such as determining the main and secondary acquirers, segmenting based on the card label or even the number of installments used for installment payments. These configurations need to be programmed by the merchant.
Undoubtedly, the multi acquirer reattempt is an alternative that allows achieving greater success rates for credit card payment processing. Furthermore, when using a service that enables payment processing with more than one acquirer, it is possible to define the acquirer to be used depending on, for example, the card label or the number of installments. This way, the system can be adjusted to obtain the best processing fee in each situation.
These changes give more freedom for merchants to negotiate their fees, in addition to increasing the flexibility on the choice of a payment solution, improving conversions and making it possible to reduce transaction costs.