get our decline rate under control

Question

From: Braintree

Hi Chad,

I hope this e-mail finds you well. We just received notification that our risk department flagged your Gratipay account as a result of a large amount of transactions being declined in your Braintree Gateway.

Of the 386 transactions recently processed, 222 have been declined. This is a huge concern for our Risk team and sponsoring bank, and our goal is to work with you to decrease the amount of declines on your merchant account so that you can resume normal processing.

In order to complete their review, the risk department is requesting: 1. An explanation for the large amount of declines. 2. The last three months’ bank statements showing beginning and ending balances to ensure that you are supportive of the increased risk exposure brought about by a large decline ratio. 3. Any processing statements you may have from your most recent merchant processing relationship 4. Itemized invoices complete with customer contact information and any applicable shipping documents for transactions [], [], and []

Funds are currently not on hold at this time. If I can be of any assistance whatsoever, please don’t hesitate to email me or call me directly at [].

Thank you in advance,

https://gratipay.freshdesk.com/helpdesk/tickets/2295

该提问来源于开源项目：gratipay/gratipay.com

Answer 1

To: Braintree

Hi, []!

Quick note to say that we've received your email, thanks for bringing the matter to our attention, and we're sorry for the trouble. :-(

The primary explanation for the large number of declines on our account is that our business model is based on weekly recurring payments, and we've simply accumulated a large number of expired or otherwise deactivated cards in the three years we've been operating, without a mechanism in place to stop attempting to charge failed cards. The easy solution for us to drastically reduce our decline rate will be to stop attempting to charge cards after one or two failures.

A secondary explanation for why the ratio is even higher than normal for us right now is that we recently started rebuilding our customer base from scratch (see Gratipocalypse and Gratipay 2.0 for background on that). I suspect that the customers for whom we have resumed processing under our new terms of service include some of our oldest customers (including Gratipay itself, which is funded on Gratipay), and, in virtue of their age, they carry a higher-than-normal decline ratio, which is skewing the overall figure.

Here's a ticket from a couple years ago when we first turned our attention to our decline rate. I've made a new ticket to address the current issue as you've raised it.

I'll follow up on Monday regarding the other three items you've requested.