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The subscription economy is growing fast. Now it's possible to subscribe to music, TV shows, disposable razors, and even socks. And the likes of Uber have shown just how easy card on file payments can be.
Subscription and recurring businesses focus on convenience and building lasting relationships with customers. And so a continuous, uninterrupted service is critical. One big pain point for both businesses and customers is involuntary churn. This is when a customer’s service is paused or canceled without them knowing.
A major cause of this is the expiry or loss of the registered card. As a solution, Visa and Mastercard provide the Account Updater service.
Account Updater is a service that lets you update your customers’ stored card details. It has different names depending on the scheme. For Visa, it's Visa Account Updater (VAU). For Mastercard, it's Automatic Billing Updater (ABU).
Account Updater works by providing information about lost and stolen cards, non-activated cards, and closed card accounts. This ensures you always have the correct card on file. So your payments remain uninterrupted and your customers enjoy a constant service.
This can only be good news. But some businesses and acquirers are hesitant. This is because of lack of Issuer participation, and the perceived poor quality of the data. So, to encourage further adoption, Visa and Mastercard have introduced new initiatives.
Visa and Mastercard have launched several programs to encourage Issuers to take part.
In October 2016, Visa made Issuer participation mandatory in the U.S. It also introduced fees in the E.U. Visa for Issuers that do not provide up to date information for expired cards. Although, unlike in the U.S., it is not an explicit mandate in the E.U.
Mastercard has also made participation mandatory in the U.S.
Issuing Bank engagement has increased as these programs came into enforcement. So, if you're a subscription or card-on-file business, you should consider integrating.
Adyen Account Updater connects its customers to Visa’s VAU, and Mastercard’s ABU. So, if you're an Adyen customer, you don't have to enroll with the schemes or prove compliance. We do this for you.
Adyen makes the Account Updater service easy and automates a bulk of the work. We maintain a central database of card data, register updates from the schemes and let you know. You always have full control over when you want to start charging the updated card details.
We offer several integration options. These include both single and bulk update requests, triggered by you. We also offer a lightweight integration with automated update logic. We calculate this based on events such as payment refusals and upcoming card expiry date.
Adyen Account Updater is available to all Adyen customers operating in covered regions.
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