Payments outages suggest retail value chain must be reassessed

By Rebekah Tunstead | 1 November 2018

Thousands of UK businesses were unable to process payments because of a network outage at the beginning of the week, with reports suggesting Worldpay encountered a temporary fault.  

Such an incident illustrates how vendors and their partners must continually assess their infrastructure, says Dr Yannis Larios, Business Development Director at Viva Wallet.

“Typically legacy systems and old servers and multiple vendors in the value chain cause these type of outages. If you have multiple vendors in the value chain of payments, typically one vendor falls and then everything falls down,” Larios says.

“In order to avoid such problems we decided to go end-to-end with our own infrastructure and not to have any intermediaries. And also to have all this infrastructure over the cloud.”

“Since we are based on the cloud we’re always ‘on’”.

Visa, which is part of the supply chain impacted by the outage released a statement: “Earlier this week, a large card processor experienced a system issue that temporarily impacted a number of Visa transactions. The processor has since resolved the issue. Visa’s network continues to operate normally.”

Sage Pay Support tweeted that Worldpay was “experiencing authorisation issues.”

The outage comes after the Visa network experienced a similar outage in June of this year.

As the UK moves towards a cashless society, it is critical for merchants to not only provide a comprehensive selection of payments methods – such as Apple Pay and WeChat Pay - but also implement smart routing capabilities to maximise transaction approvals and avoid losses during network failures, according to Yuval Ziv, CCO of SafeCharge.

“Smart routing is the guardian angel that ensures transactions to be re-routed to an alternative acquirer in case a platform fails, subsequently minimising transaction losses and ensuring a stable payments channel,” said Ziv.

“With digital commerce showing no signs of abating, smart routing will be a key ingredient to improve the shopping experience and most importantly build customer loyalty, which will help merchants to combat churn and drive revenues.”

Larios says he doesn’t expect the outage to have any immediate significant impact. However, it does show how fragile payment systems are if they are not based on modern technologies.

“If you have a system that goes end-to-end you have a much more reliable system,” he says.

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