KPIs To Track Efficiency & Reliability of Payment
                     KPIs To Track Efficiency & Reliability of 
Payment Processing Metrics
An Introduction
How does it sound if a customer excitedly fills their virtual cart, ready to purchase. But at 
the final hurdle – checkout – their payment gets declined. Frustration sets in, and with a 
click, they abandon their cart, leaving you (or a business you work with) with lost revenue 
and a potential customer gone forever. Did you know that according to a 2015 Forrester 
Research study, abandoned carts due to payment processing issues cost businesses billions 
of dollars annually? Sluggish or unreliable payment processing isn't just an annoyance – it's 
a silent profit killer.
 
1. Transaction Processing Time
This metric measures the average time it takes for a customer's payment to be completed, 
from entering their information to receiving confirmation. Slow processing times can lead 
to frustrated customers abandoning their carts before completing the purchase. Aim for a 
processing time under 5 seconds for optimal customer experience.
2. Authorization Rate
This KPI reflects the percentage of transactions successfully authorized by the issuing bank. 
A high authorization rate indicates your system is effectively communicating with banks 
and minimizing declined payments. A low rate could be due to various factors like 
insufficient funds, incorrect card information, or fraud prevention measures. Analyze the 
reasons behind declines and work with your payment processor to optimize authorization 
processes.
3. Settlement Time
This refers to the timeframe it takes for funds from a completed sale to be deposited into 
your merchant account. Faster settlements improve your cash flow and allow you to access 
revenue quickly. Settlement times can vary depending on your payment processor and your 
industry but generally range from 1-5 business days.
4. Cart Abandonment Rate
This metric tracks the percentage of customers who add items to their carts but fail to 
complete the purchase. Payment processing issues are a major contributor to cart 
abandonment. By monitoring this KPI and analyzing abandoned cart data, you can identify 
where breakdowns occur in the checkout process and optimize your payment system for a 
smoother experience.
5. Dispute Resolution Time
Even with the best security measures, customer disputes can arise. This KPI measures the 
average time it takes to resolve these disputes, which can range from billing inquiries to 
chargebacks. Prioritize prompt and efficient dispute resolution to minimize customer 
frustration and potential chargebacks that can impact your processing fees. 
Optimizing Your Payment Processing: 
Turning Insights into Action
KPIs are your roadmap to a smoother checkout experience. By tracking these metrics, you 
can pinpoint bottlenecks that slow down processing and identify areas for optimization.  
Partnering with a reliable payment processor with a strong uptime record and robust 
security measures is key. Additionally, investing in advanced security solutions can further 
minimize fraud and maintain customer trust. Remember, KPIs are not a one-time analysis. 
Conclusion
In conclusion, tracking Key Performance Indicators (KPIs) for payment processing efficiency 
and reliability is crucial for businesses aiming to enhance customer satisfaction and 
maximize sales. This data-driven approach forms the foundation for a thriving payment 
ecosystem. For those with an entrepreneurial spirit, the insights gained from KPI tracking 
can be invaluable when you are willing to start your own payment gateway business. By 
understanding the intricacies of payment processing and the needs of businesses, you can 
create a solution that prioritizes speed, security, and a seamless customer experience.
THANK YOU