Names and aliases
payment decline rate, failed payment attempt share
Formula
failed_payment_attempts / total_payment_attempts × 100%
Metric card
| Unit | % |
|---|---|
| Data source | Payment attempt events, provider response codes, retry flags, successful capture events, and attempt-window boundaries. |
| Frequency | Per attempt window; recompute whenever the payment provider or routing changes. |
| Segments | micro-market, payment method, payment provider, decline code, device, geography, amount |
Interpretation errors
- Computing the rate over attempts and reading it as the share of lost transactions: one successful retry closes several failed attempts.
- Merging issuer declines, insufficient funds, anti-fraud blocks, and technical failures into one figure.
- Ignoring that automatic retries mechanically inflate the denominator.
Example
Illustrative example: 45 of 900 payment attempts fail, producing a 5% rate. The numbers describe no real platform.
Use
Track two metrics at once: the share of failed attempts and the share of confirmed interactions where no attempt ever succeeded. The first describes the health of the payment path, the second the actual loss to the market. Break declines down by response code and separate platform-controllable causes from external ones.
Anti-example
Disabling automatic retries lowers the failed-attempt rate because retries leave the denominator, while the share of interactions that never reach payment at all may rise.
Limitations
- A large share of declines originates with issuers and anti-fraud systems and is outside platform control.
- The attempt-based and interaction-based rates answer different questions, and substituting one for the other is the most common error in this area.
- The value depends on the mix of payment methods and is therefore not comparable across markets with different payment infrastructure.
Related metrics
transaction-completion-rate, failed-transaction-rate, cancellation-rate, refund-rate
Context sources
These works provide two-sided-market context; the formula above remains an author-defined working definition.
- Jean-Charles Rochet, Jean Tirole. Platform Competition in Two-Sided Markets (2003).
- Mark Armstrong. Competition in Two-Sided Markets (2006).