How Payment Routing Can Save You 20% or More on Card Costs
What Is Payment Routing?
Payment routing is the process of directing transactions through the most cost-effective or high-performing processor available. An agnostic payment gateway enables this flexibility.
Why It Matters in 2025
Card networks have raised interchange rates slightly, while alternative payment methods like open banking are expanding. Routing provides an immediate way to reduce costs without changing providers.
How It Works
Routing Strategy | Example | Typical Benefit |
Cost-Based Routing | Direct transactions to lowest-fee acquirer | 10–20% lower average fee |
Performance Routing | Route to processor with best approval rate | Higher success & fewer declines |
Geo-Based Routing | Match acquirer to cardholder location | Better authorization rates |
Fallback Routing | Backup routes if one processor fails | Prevents downtime losses |
Key Technologies
- Real-time analytics
- Multi-acquirer integration
- AI-based routing engines
- Payment orchestration platforms
Conclusion
In 2025, payment routing is not just a back-end feature—it’s a strategic financial lever. Merchants using dynamic routing systems are saving 10–25% in costs while improving uptime and customer experience.
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