What Is Approval Rate? A Complete Guide for Merchants in 2025
Approval rate is one of the most important KPIs for any online merchant. A few percentage points up or down can translate into thousands of euros lost or recovered every month. Yet many teams still look at approval rate only at a very high level – by PSP or by day – without understanding where exactly they are losing money.
What is payment approval rate?
In simple terms, approval rate is the percentage of payment attempts that end up approved by the issuer. A basic formula looks like this:
Approval rate = Approved transactions / Total authorization attempts × 100%
“Total authorization attempts” usually includes all online auths sent to the schemes (Visa, Mastercard, etc.), excluding technical retries or duplicates if you filter them out.
Why approval rate matters so much
Approval rate combines three worlds:
- Customer behavior – card validity, balance, willingness to try again
- Issuer risk rules – fraud checks, regional risk appetite
- Your payment setup – routing, 3DS flows, PSP configuration
If you only look at topline revenue, you might miss the fact that approval rate slowly decreases in a specific country, on mobile, or after a recent change on your checkout page.
Common approval rate mistakes
Looking only at daily totals
Daily or weekly aggregates are useful, but they hide the patterns. For example, your global approval rate can be stable while a key country like DE or FR is dropping for a specific card range or device type.
Mixing soft and hard declines
Not all declines are equal. Some are “soft” – the customer might succeed on retry. Others are “hard” and will almost never be recovered. Grouping them together makes it harder to decide which issues to work on first.
Ignoring the role of 3DS
3DS can significantly change approval rate. Some issuers strongly prefer authenticated transactions, others handle them more cautiously. If you don’t split approval rate by 3DS status and result, you may misinterpret what is actually going on.
How to slice approval rate to find issues
At minimum, merchants should monitor approval rate by:
- Country of issuer and shopper
- Device type (mobile / desktop / tablet)
- Card brand and scheme
- 3DS status (attempted / completed / not used)
- PSP / acquirer or routing path
Once you see a combination like “mobile · 3DS challenged · specific country” constantly underperforming, you have a concrete place to investigate instead of staring at a single topline percentage.
How PayLens helps you improve approval rate
PayLens is built specifically to answer questions like:
- “Where exactly in my checkout funnel do I lose the most approvals?”
- “Which countries and devices are dragging my global approval rate down?”
- “Did a recent checkout or 3DS change actually improve results?”
With PayLens you get:
- A clear funnel from
checkout_opentopurchase - Approval rate split by geo, device and 3DS status
- A live tail of recent events to debug issues in real time
If you’d like to see how your approval rate looks through the PayLens lens, you can request a demo and we’ll walk you through a sandbox dashboard tailored to your use cases.