Visa and Spreedly Combat Failed Payments Via Just-in-Time Card Updates

The collaboration, announced Tuesday (June 24), centers around an enhancement of the Spreedly platform through the integration of just-in-time card updates for Visa Cards powered by Visa Account Updater (VAU).

“Outdated card details are a key driver of failed payments, particularly in recurring billing or subscription models,” the company said in a news release. “Spreedly’s Just-In-Time Card Updates integration addresses this challenge by providing merchants with up-to-date card credentials precisely when they’re needed.”

Unlike traditional card update strategies, which arrive on a scheduled batch basis, just-in-time card updates allow real-time access to refreshed card credentials at the point of transaction to offer merchants more control and responsiveness.

Using the “advanced vault capabilities” of Spreedly’s open payments platform, the company leverages Visa’s network to help merchants fetch card updates at the proper place and time.

“This ability to leverage tools on demand allows businesses to better manage their operational costs and prevent disruption to the customer experience for card-on-file and subscription payments,” the company added.

PYMNTS Intelligence has collaborated with Spreedly on reports such as “How Open Payments Boost Performance,” noting that these payment platforms help merchants bolster conversion rates, keep on top of key performance metrics, and lower their involuntary churn, especially for subscription businesses.

“False declines — when a payment is incorrectly rejected — are a costly problem for merchants,” PYMNTS wrote earlier this year. “According to the report, $157 billion in U.S. eCommerce sales were at risk due to false declines in 2023. Of this, $81 billion was projected to be permanently lost despite attempts to recover the payments.”

Keep in mind that 47% of retailers mentioned false declines as having an especially negative impact on customer satisfaction, with 58% of small and medium-sized businesses (SMBs) saying these declines had a major impact on operations. Making matters worse, 82% of online retailers had trouble identifying the causes of failed payments.

“Open payments platforms mitigate these challenges by enabling intelligent routing of payments to the optimal gateway,” PYMNTS added. “This can prevent payments from being incorrectly declined by trying different payment routes, such as leveraging historical transaction data or selecting a gateway with lower fees. This recovers lost revenue and provides customers with a smoother, more seamless experience. For merchants, this leads to an increased likelihood of customer retention, driving future revenue growth.”