Wednesday January 19th, 2022 8:56PM

Retailers to Miss Out on $700 Million in Holiday Sales Due to Digital Payment Channels Inefficiencies

By The Associated Press

ATLANTA--(BUSINESS WIRE)--Nov 23, 2021--

Despite economic recovery in the retail sector in 2021, with the National Retail Federation (NRF) forecasting sales up between 10.5% and 13.5% over 2020 i, merchants are estimated to miss out in almost $700 million in rejected sales on Black Friday and Cyber Monday, reports , the global leader in retail payments advisory. Black Friday and Cyber Monday present an opportunity for retailers to benefit from a significant boost in revenue, but CMSPI expects some erosion due to merchants’ payments set-up.

This Black Friday and Cyber Monday customers will be flocking to online channels for their holiday shopping and are more likely than ever to have their payment methods falsely declined. This occurs when a legitimate transaction is either blocked or labeled as fraudulent, leading customers to try alternative payment methods or abandon the sale altogether, and shop at a different merchant. These lost rejected sales are only compounded during periods of large transaction volume.

A lot goes on behind the scenes once a customer hits ‘pay’ on either their mobile app or website, due to complexities in the payments supply chain. From fraud rules, legacy systems, and lack of communication, many legitimate card transactions are declined. Retailers and payment firms are working together to reduce false declines and increase sales but there’s still work to be done to ensure customers have a seamless shopping experience and merchants recognize all non-fraudulent top line sales.

“We saw incredible growth in digital channels this year coming off 2020 but still 1 in 5 transactions are false declined. This is a massive issue with customers going online on Cyber Monday,” said Toby McFarlane, Head of Ecommerce for CMSPI. “Retailers are missing out on a substantial amount of sales and risk losing customers if their payment is declined. In this competitive retail environment, it is more important than ever for merchants and the supply chain to work together more productively to ensure all non-fraudulent customer payments are approved.”

CMSPI is an independent, data powered, global consultancy advising clients on how to improve the productivity of their payments arrangements by reducing costs, increasing sales, and implementing innovative solutions.

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PUB: 11/23/2021 09:30 AM/DISC: 11/23/2021 09:31 AM

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