June 7, 2018
As the subscription model makes more inroads in e-commerce, declines due to the expiration or reissue of credit cards are becoming a more significant problem. Businesses that keep cards on file to enable automatic payments can access account updater services to make sure the cards they are billing are updated with the most recent information.
Account updater services from the major card networks have been increasingly available to merchants through their acquirers for years, but only in 2016 did Visa and Mastercard require their issuers to participate. This week, Dutch e-commerce processor and acquirer Adyen announced it is the first online payment provider to make the most recent version of Mastercard’s account updater service available to subscription merchants to minimize declines.
The card network’s Account Billing Updater now provides new information in real time if cards are reissued due to theft, loss or expiration.
“The subscription economy is experiencing massive growth, with 100% increase year-over-year for the last five years. Beyond digital services, Adyen is seeing a strong uptake in physical products like cosmetics, fashion and bicycles now offered as a subscription service. Payments are a critical touchpoint for ensuring uninterrupted service for customers and sustained revenue for merchants,” said Roelant Prins, chief commercial officer at Adyen. “Adyen, together with Mastercard’s Account Updater, is focused on making the highest number of payments succeed by automatically updating card data at the point of transaction, preventing involuntary card declines due to expired or replaced cards.”