Topic starter
11/07/2026 8:26 pm
TL;DR: Banks decline about 15% of legitimate orders, and Signifyd argues merchants can lift approval rates by sending cleaner data, richer context and better identity signals, with one percentage point translating into 2,000 additional monthly approvals in a 200,000-order example. The lesson for practitioners is that authorization performance is increasingly an identity and data-quality problem, not just a payment-routing problem.
Editorial analysis by NHI Mgmt Group, based on content published by Signifyd: “5 strategies to increase bank authorization rates for merchants”.
By the numbers:
- Banks falsely decline about 15% of legitimate orders, according to Signifyd data.
- A strong bank authorization rate averages around 85% for online merchants, according to Signifyd.
- One percentage point of authorization lift equals 2,000 more orders approved each month in a 200,000-order example, according to Signifyd.
Key questions
Q: How should security teams reduce false declines without weakening fraud controls?
A: Start by separating hard fraud stops from soft operational failures, then improve the context used in payment decisions.
Q: Why do legitimate ecommerce transactions still get declined by issuers?
A: Legitimate payments can still fail when issuers lack enough context to trust the transaction.
Q: What breaks when merchants send every order straight to the bank?
A: The issuer has to sort good traffic from bad traffic without enough context, so expired cards, bots and inconsistent records can contaminate the transaction stream.
Practitioner guidance
- Implement risk-based step-up authentication Use 3D Secure or equivalent challenges only for transactions that need more proof, and keep low-risk flows as friction-light as possible.
- Pass merchant-authenticated identity signals Attach verified customer signals such as logged-in account status or biometric app authentication when the merchant can attest to the buyer.
- Enrich orders before authorization Send complete billing, shipping, device and behavioural context to issuers so the decision engine is not relying on sparse transaction fields.
Bottom line: False declines are not just a fraud problem. They also show that issuers are approving or rejecting commerce with incomplete identity context.
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11/07/2026 8:56 pm
Authorization rate is now an identity governance problem, not a payment-only problem: merchants increasingly win or lose approval on the quality of the identity evidence they can attach to a transaction. The issuer is making a trust decision with incomplete context, so the merchant that can attest to the customer more credibly will usually outperform the merchant that merely forwards raw payment data. For practitioners, that means identity signals belong in commerce governance, not just fraud operations.
A question worth separating out:
Q: When should merchants use step-up authentication instead of a straight approval flow?
A: Step-up authentication should be used when a transaction is borderline and the merchant or issuer needs more proof before approval. It is most useful where the added challenge can resolve uncertainty without creating excessive friction. For routine low-risk transactions, it is usually better to preserve speed and avoid unnecessary customer drop-off.
👉 Read our full editorial: Bank authorization rates expose the identity gap in ecommerce fraud