Credit card transactions get declined for numerous reasons (i.e. invalid card, expired card, insufficient funds, bank declines or some other issue.)
Declines can come from your processor, the payment gateway (due to fraud filters or rules you have in place) or the card issuer.
A decline rate is the ratio of total number of attempted credit card authorizations against attempted credit card authorizations that are declined.
High decline rates may put you out of scope with card issuers and put your merchant account at a risk of closure. To reduce your decline ratios, it is important to understand the reason behind your declines. There are hard and soft declines and each declined transaction has a declined message / reason code.
Hard declines - the transaction should not be reattempted, cardholder should reach out to their bank to resolve.
Soft declines - you may be able to reattempt and resubmit the transaction for successful approval once the issue is addressed. However, the acceptable procedure is not to attempt the same declined card more than twice for the same amount within a 24-hour period.
False declines - can occur when a transaction is suspected as fraud and declines even though it is legitimate.
In April 2021, Visa implemented new decline management rules which will be going into effect in stages and help you as the merchant manage your decline ratios and fraudulent transactions.
Decline responses will be grouped into four categories with more descriptive decline codes and guidelines on whether the transaction should be reattempted or not.
| CATEGORY | DESCRIPTION | RETRY |
| 1 | Issuer Will Never Approve Generally decline codes include a card that is blocked, lost or stolen (i.e. Pick up card). |
|
| 2 | Issuer Cannot Approve at this Time Generally includes codes where issuer cannot approve due to temporary conditions or restrictions. |
 If conditions change, merchant may retry. |
| 3 | Data Quality Generally includes codes when issuer cannot approve the transaction based on details provided (i.e CVV may be invalid) |
 Merchant may retry once data is corrected. |
| 4 | Generic Response Codes Generally includes all other codes or ones where no description is available. Declines which fall into this category are minimal. |
 Merchant may retry |
Merchants should NOT retry authorization within 30 day period.
A detailed list of Visa's enhanced response codes is attached to this article.
Steps you can take:
Review where the decline is coming from and reason code
Never re-attempt hard declines
Do not reattempt soft declines more than twice within 24 hour period.
If using payment gateway, review filters
Implement Address Verification Service (AVS) and CVV code checks
For recurring transactions, enroll for account updater service to have expired cards automatically update
For ecommerce transactions - set fraud prevention velocity filters
For ecommerce transactions- sign up for EMV 3D secure which provides an additional behind the scenes authentication layer