Commerce Glossary
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What is an Authorization Rate?
au - tho - ri - za - tion rate
noun
Authorization rate determines how many of the total number of transactions were successful.
How Does the Authorization Rate Work?
Authorising a transaction is a step in the payment flow where funds are being held in a bank account until payment is confirmed. After the confirmation of the payment, the card is actually charged.
Tracking authorization rates provides insights into how authorizations are managed, or what tools, if any, are utilized to increase authorization rates. Similar to conversion rates, authorization rates vary depending on the type of transactions (cross-border vs. local, new acquisition vs. renewal), region, currencies, and other elements such as card type – debit/credit/prepaid.
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