The Ultimate Payments Optimization Checklist: 10 Questions Every Payment Leader Must Ask
Payments isn’t just an operational necessity—it’s a revenue driver when done right. Yet, most businesses don’t think about payments strategically and leave money on the table by failing to optimize.
💡 The best companies treat payments as a competitive advantage.
If you own or influence payments at your company, here’s your go-to checklist. These 10 questions will help you audit, optimize, and future-proof your payments stack, ensuring higher approval rates, lower processing costs, and a frictionless customer experience.
1️⃣ Can You Actually Change Your Checkout Experience?
💡 Problem: Many businesses assume they own their checkout experience—until they realize they don’t.
✅ Do you have full control over checkout design, layout, and UX, or is it dictated by your PSP or platform?
✅ Can you customize payment fields, branding, and error messaging, or are you stuck with a generic template?
✅ Can you integrate third-party tools (fraud prevention, analytics, A/B testing), or are you limited by platform restrictions?
🔹 Pro Tip: If your checkout is locked down by your PSP or platform, you’re likely losing conversions and missing opportunities to optimize for your customers. A custom checkout flow can increase conversion rates by over one-third.
2️⃣ How Portable Are Your Tokens?
💡 Problem: Not all tokens are created equal—some lock you into a single PSP, while others allow seamless migration and higher approval rates.
✅ Are your tokens PSP-specific (e.g., Stripe tokens only work with Stripe) or network tokens (Visa, Mastercard) that can be used across multiple PSPs?
✅ If you use a payment orchestration layer, is tokenization happening upstream of your PSPs, allowing transactions to be routed dynamically without re-tokenizing?
✅ Are you preserving the NTID (Network Transaction ID) across PSPs? Losing NTID means losing transaction history, which hurts authorization rates for MIT (Merchant-Initiated Transactions) like subscriptions and installments.
✅ Can tokens cross-pollinate across merchants or business units?
- Amazon Model: Tokens are platform-owned and can be used across different sellers (a customer saves their card once and can buy from any Amazon seller).
- Shopify Model: Each seller’s tokenized payments are isolated (a customer’s saved card on Store A can’t be used on Store B).
✅ How easy is it to migrate stored payment credentials if you decide to switch PSPs?
🔹 Pro Tip: PSP-specific tokens lock you in, making migrations painful. Network tokens or orchestrator-managed tokens allow seamless switching between gateways, reducing dependency on a single provider and improving approval rates.
3️⃣ Are You Ready for Global Expansion?
💡 Problem: Expanding to new markets isn’t just about adding currencies—it’s about compliance, costs, and customer experience.
✅ What regions do we operate in, and where are we expanding?
✅ Are we compliant with local payment regulations (PSD2 in Europe, RBI guidelines in India, GDPR, CCPA, etc.)?
✅ Do local laws require payment data to be stored in-country (e.g., India, Brazil, China, Russia)?
✅ What’s the cost of setting up a legal entity vs. using a Merchant of Record (MoR) service to handle compliance, tax, and settlement?
✅ Do we support local payment methods (Pix, UPI, iDEAL, Alipay, Klarna, Boleto, etc.) to match customer preferences?
🔹 Pro Tip: Setting up a legal entity can cost $50K+ in compliance fees and take months. Using an MoR service eliminates this burden, allowing you to enter new markets faster and at lower cost.
4️⃣ Does Your Payment Flow Match Your Business Model?
💡 Problem: If your payments strategy doesn’t align with your business model, you risk higher fees, compliance issues, and lost revenue.
✅ Are we a merchant of record (MoR), a marketplace, or a platform that allows customers to bring their own PSP?
✅ How do we handle pay-ins, payouts, and split payments?
✅ Who owns the tokenized payment method—the platform, the seller, or the PSP?
✅ Do tokens cross-pollinate across sellers or remain isolated?
✅ Are we handling regulatory compliance correctly (e.g., KYC for sellers, PSD2 for Europe, taxation rules for digital vs. physical goods)?
🔹 Pro Tip: Marketplaces and platforms need a well-defined tokenization strategy. Cross-pollination of tokens improves conversion & UX but can create compliance risks.
5️⃣ Are You Losing Money on Recurring Payments?
💡 Problem: 30% of recurring payments fail due to expired or declined cards—but most businesses don’t have a solid strategy to fix this.
✅ Are we using network tokens (Visa, Mastercard) that update cards automatically, or do we rely on Account Updater services?
✅ What’s our retry strategy for failed transactions?
✅ Are we preserving NTID continuity for MIT transactions to prevent failed authorization?
🔹 Pro Tip: Network tokens automatically update expired cards, reducing churn without relying on external refresh requests. A smart retry strategy and proper NTID tracking can recover 5-15% of lost revenue.
6️⃣ Are You Overpaying for Payment Processing?
💡 Problem: Many businesses are on suboptimal pricing models and misclassified MCC codes, leading to higher fees.
✅ Are we on Interchange-Plus Pricing (transparent) or Flat Pricing (simpler but often more expensive)?
✅ Have we reviewed our MCC (Merchant Category Code)?
✅ Are we locked into a single PSP, or do we have redundant options for negotiating better rates?
🔹 Pro Tip: Interchange-Plus Pricing is usually cheaper than Flat Pricing, especially for high-volume merchants. An incorrect MCC classification can increase fees and impact approval rates.
7️⃣ Payment Methods & Transaction Types
✅ What’s our mix of card-present (POS), card-not-present (eCommerce), and MOTO (call center) transactions?
✅ Are we supporting alternative/local payment methods (APMs/LPMs)?
✅ Do we need buy now, pay later (BNPL) or subscription-based payments?
💡 Why This Matters: Adding APMs like UPI (India), Pix (Brazil), or Klarna (Europe) can increase conversions by 20-30% in those markets.
8️⃣ Risk, Fraud & Authorization Rates
✅ What’s our current authorization rate, and how does it compare to industry benchmarks?
✅ What are our most common decline reasons?
✅ Are we using 3DS authentication, machine learning fraud tools, or manual review?
💡 Why This Matters: Fraud accounts for 0.5%-1.5% of revenue losses for most merchants—having the right balance of risk vs. conversion is critical.
9️⃣ Migration & Integration Complexity
✅ If we switch PSPs, how big is the migration project?
✅ What is the estimated engineering effort for new payment integrations?
✅ Do we have testing & QA environments to validate payment flows?
💡 Why This Matters: Payment migrations can take 3-9 months, and poorly planned migrations can lead to service disruptions & lost revenue.
🔟 Payment Strategy & Leadership Buy-In
💡 Problem: If your leadership team sees payments as a cost center instead of a revenue enabler, you’ll always be in firefighting mode.
✅ How much of our engineering resources go toward fixing payments vs. building customer-facing features?✅ Do we proactively optimize payments, or only react when things break?✅ What’s our long-term vision for payments—and does it align with business growth?
🔹 Pro Tip: Payment leaders who actively optimize their stack outperform those who just maintain it.
🔴 The Hidden Cost of Inaction in Payments
📊 The average merchant loses 3-5% of revenue due to failed transactions.📊 65% of customers abandon checkout if their preferred payment method isn’t available.📊 Payment failures are the #1 cause of involuntary churn in subscription businesses.
Most businesses are leaving money on the table without realizing it. The best payment leaders don’t just maintain their stack—they optimize before things break.
🚀 Take Action: Let’s Optimize Your Payments Stack
🔹 Want a deep dive into your payments data?🔹 Looking to increase approval rates and lower processing costs?🔹 Need an expert assessment of your global payments strategy?
Reach out to atlasofpayments@gmail.com ;