Payment Lifecycle Management: Ensuring Evergreen Card Data

Seamless payment experiences often drive customer loyalty and digital revenue. 

In Discover’s 2024 Payment State of the Union, 61% of surveyed merchants view payments as a strategic area for achieving competitive differentiation. A further 53% of merchants believe offering a wide selection of digital payment methods increases conversions.

The rise of open payment technologies has empowered customers to opt into sharing their payment data with third-party providers. In turn, customers now expect (and sometimes demand) quick checkout processes and uninhibited access to their preferred payment methods. 

To meet new customer expectations regarding digital payment experiences, you need to optimize your approach to payment lifecycle management. Specifically, you need a system or platform capable of securely storing your customers’ payment data and keeping it refreshed with the latest information. 

What is Payment Lifecycle Management?

The term payment lifecycle management refers to your process for managing stored card details.

When a customer enters their payment information into your system for the first time, they enter important authorization details like their security code and zip code. Many merchants now allow customers to save this information in the payment system, allowing for faster checkouts in the future. 

However, customer information can change over time.

Maybe a customer moved to a new state, or maybe they got a new card with a different PIN. Whatever the case may be, any changes to a customer’s cardholder data can render their stored payment details in your system useless until updated.

For merchants that accept recurring payments, such as for subscription services, outdated card information can complicate the payment process for customers. If the problem proves difficult to resolve, the customer may walk away altogether, resulting in lost sales revenue.   

Effective payment lifecycle management allows you to maintain the accuracy and validity of your stored card details throughout their lifecycle in your payment system. 

From initial card registration to information updates, or even card expiration or removal, a clear approach to payment lifecycle management can help you maximize your benefits from stored payment data. Additionally, your payment lifecycle management strategy needs to be compliant with the latest payment regulations, such as PCI DSS v4.0. 

Achieving this involves implementing mechanisms to validate card information upon entry, such as performing address verification and card authentication checks.

Taking a proactive approach to payment lifecycle management is the key to keeping stored card details fresh. By employing advanced technologies and automated systems to support your payment system, you can prompt users to update their payment information and verify stored data. 

A strong payment lifecycle management strategy also reduces the risk of payment failures or errors due to outdated card information. Through enhanced efficiency and success rates, your payment system can play a vital role in building trust and loyalty amongst your customers.  

The Importance of Keeping Your Stored Payment Data Updated 

Keeping your customers’ payment information fresh requires frequent updates to verify the accuracy of data stored in your payment system. In the context of recurring payment use cases, evergreen payment data becomes especially important for ensuring you receive future-dated payments. 

Optimizing your payment lifecycle management strategy to keep your payments evergreen reaps many rewards, including: 

1. Higher transaction success rates: Accurate and up-to-date card details ensure your system can process payments successfully on the first try. Increasing your transaction success rate is a necessity, as high rates of payment failure can lead to significant revenue loss.  
2. Increased customer convenience: Up-to-date stored payment data simplifies the checkout process for your customers, allowing them to make purchases without having to update or re-enter their payment information repeatedly.
3. Simplified risk management: Outdated card details increase the risk of payment fraud and unauthorized transactions. A payment lifecycle strategy that enables automated updates of stored card information helps mitigate the risk of fraudulent activities.
4. Reduced compliance burden: Many regulatory standards have strict requirements regarding how businesses store and manage customer payment data. Keeping card details accurate and up to date helps companies remain compliant with these standards.
5. Boosted trust and loyalty: Customer trust in your checkout process and payment system is often the key to winning long-term loyalty. Plus, clearly demonstrating your commitment to secure payment storage is essential for winning new customers.

Improving Your Payment Lifecycle with Network Tokenization

Optimizing your payment lifecycle management strategy starts with utilizing all of the advanced tools and technologies at your disposal. At Spreedly, our network tokenization and lifecycle management capabilities help maximize your payment lifecycles. 

Network tokenization, the process of replacing card numbers and primary account numbers (PANs) with a randomized token provided by the card brand, offers dynamic token updates that can boost your authorization rates and streamline fraud management. 

From a payment lifecycle management perspective, network tokenization helps to simplify recurring payments and reduce declines due to outdated or inaccurate payment details. 

Meanwhile, the lifecycle management tool automatically updates stored payment information. Lifecycle management accomplishes this feat through Spreedly’s partnership with various card brands, allowing for efficient communication regarding changes to a customer’s payment data. 

Most often, factors like card expirations, stolen card information, or account closures lead to stored payment data becoming outdated. With the help of lifecycle management, you can keep your payment system functioning smoothly by safeguarding against disruptions to your card-on-file environment. 

Optimize Your Payment Lifecycle Management with Spreedly

Advanced Vault is equipped with capabilities like network tokenization and automatic account updates, Spreedly has the tools you need to upgrade your payment lifecycle management strategy.

Compliance is often one of the most significant inhibitors of effective payment lifecycle management. With Spreedly, our PCI Level 1-compliant vault helps you reduce your compliance burden so you can focus on building satisfactory front-end customer experiences. 

Spreedly’s Advanced Vault can increase your acceptance rates and lower your operational costs, all while delivering a better payment experience to your customers. Together, our vaulting and payment orchestration capabilities provide your business the support necessary to scale upwards and outwards.  

Find out how Spreedly can help you maximize revenue by optimizing payment lifecycle management.

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