If you’re like most MVNO executives, you may not think much about your payment processor. If you do, you’re likely to focus on three key factors: brand reputation, API integration ease, and processing rates. These are important considerations, but you might be missing a revenue opportunity sitting right in front of you.
The credit card approval rate blind spot
Few MVNO execs track their credit card approval rates. This represents a significant missed opportunity.
Consider the math: For an MVNO with 100,000 customers paying $25/month, a 1% improvement in approval rates generates $300,000 in additional annual revenue. Scale that to 1 million customers, and you’re looking at $3 million.
Meanwhile, negotiating processing rates from 2.9% to 2.7% saves about $60,000 annually on the same volume. Which, in this case, means the approval rate optimization delivers 50 times more value than rate optimization.
Understanding the full cost picture
When evaluating payment processing costs, it’s important to look beyond the sticker price. The total cost includes processing fees, chargeback penalties, and—most significantly—the revenue impact of declined transactions.
Some MVNOs discover they’re paying far more than expected when hidden costs accumulate. Chargebacks don’t just cost the original processing fee; they often include penalty fees and can push you into higher-risk pricing tiers. In extreme cases, total processing costs can reach 8-11% when these factors combine.
The multi-acquirer advantage
Payment infrastructure design significantly impacts both approval rates and business continuity. Processors with single acquirer relationships limit your options—you’re dependent on one bank’s risk appetite and approval algorithms.
Different banks have different strengths: one might excel at international transactions while another specializes in prepaid patterns. Intelligent routing with a multi-acquirer processor can improve approval rates by 10-15 percentage points by matching transactions to the most suitable acquirer.
This approach also provides operational resilience. If one acquirer experiences issues or tightens risk controls, transactions can seamlessly route through alternative connections without business disruption.
Higher approval rates make for happier customers
Payment success directly impacts customer satisfaction and retention. When existing customers get declined during top-ups, their service stops working—creating immediate frustration and churn risk.
Payment flexibility features like intelligent retries, partial payment acceptance, and alternative payment methods can recover revenue that would otherwise be lost to rigid yes/no processing.
For customer acquisition, payment decline rates directly impact marketing ROI. If you’re spending $200-400 to acquire customers but 15% get declined at checkout, you’re wasting a lot of marketing investment.
Why not explore your payment processing options?
The payment processing landscape offers more options and optimization opportunities than many MVNOs realize. Understanding the full revenue impact—not just processing costs—can unlock significant growth potential.
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