Routing

Routing is the intelligent process of directing payment transactions through the most optimal path from initiation to completion. Payment routing involves selecting the best , , or payment method based on various factors, including transaction success rates, processing costs, geographic considerations, and real-time performance metrics. Advanced routing systems often form part of a platform and use machine learning algorithms to continuously optimize transaction paths, improving authorization rates while reducing processing costs and transaction times.

A key component of payment routing is cascade routing. It is a failover mechanism, where transactions are automatically routed through multiple payment processors or acquiring banks in sequence when the primary option fails or declines. The cascade system attempts to process the payment through alternative routes until successful authorization is achieved or all options are exhausted. This approach significantly improves overall transaction success rates by leveraging different processors' strengths and relationships with various issuing banks, ultimately reducing false declines and maximizing revenue capture.