Merchants Start Chasing High Approvals Instead of Low Fees

Watch more: Need to Know With North’s Suril Patel

When merchants viewed payments solely through the lens of cost, they typically looked for as little cost as possible.

But that one-dimensional calculus is breaking down in the face of today’s multifaceted commerce realities. As transactions become continuous and embedded across services, payments systems are increasingly functioning less like utilities and more like coordinated networks of intelligence.

“Post-pandemic, we saw a big shift,” Suril Patel, senior director of product management, EPX, at North, told PYMNTS. “Merchants realized the importance of the payment space. It wasn’t just a necessary evil.”

As a result, businesses that once negotiated fees in fractions of a cent are now examining how authorization performance affects top-line results.

“For a larger merchant, a one or two percent improvement in approval rates can add millions of dollars in revenue a year,” Patel said. “They’re now focused on payments as a revenue driver.”

The reorientation reflects structural changes in how companies sell and deliver services. Subscription commerce, digital platforms and embedded payment experiences depend on continuity. A failed transaction is no longer an isolated billing problem; it can interrupt access to software, media or essential services. In these cases, payment reliability becomes indistinguishable from product reliability.

“Customers who leverage subscription services expect these services to work 24/7 without fail,” Patel said, noting that a single lapse can lead to customer attrition.

Reconsidering the Architecture of Payments

The payment and commerce landscape’s evolution is also altering how payment providers structure their own operations. Enterprises that once accepted fragmented payments stacks as unavoidable are now questioning whether those arrangements impede adaptability at a time when commerce is expected to function continuously.

North’s own acquisition of EPX in 2014 highlighted a strategic move toward consolidation and always-on reliability. By controlling processing internally, the company is now able to unify the transaction lifecycle from the point of sale through settlement, while at the same time reducing dependency on external intermediaries and allowing closer management of cost, speed and security.

“By owning the entire transaction from the merchant’s point of sale to the final settlement, EPX and the North ecosystem helps eliminate costly third-party intermediaries,” Patel said, adding that the system supports approximately 250,000 merchants and processed more than $70 billion in payments during 2025.

“We’re a fully PCI-compliant platform with 99.999% uptime,” he added.

This expectation of uninterrupted service is particularly pronounced among subscription-based businesses, where failed payments can translate immediately into customer attrition. In such environments, reliability is inseparable from revenue protection.

To address that risk, processors are deploying tools such as real-time account updates and network tokenization, which automatically refresh card credentials and reduce avoidable declines. These capabilities operate largely outside the consumer’s awareness but play an essential role in preserving continuity.

Card Networks Recast as Technology Platforms

The evolution of payments infrastructure is also reshaping relationships between processors and card networks. Networks that once functioned primarily as settlement rails are positioning themselves as providers of technology services and data capabilities.

“The partnership has definitely become more strategic as the Visas of the world have become platforms for innovation rather than just settlement systems,” Patel said.

EPX itself maintains direct connections to major networks and has collaborated on initiatives designed to expand modular integration. One such effort involves Visa Platform Connect, which Patel described as opening network capabilities to merchants in a more flexible manner, allowing them to adopt services without overhauling existing systems.

“Merchants and partners of all sizes really see the strategic value of being connected and working with savvy payment processors and merchant acquirers,” he said. “Processors have transitioned from being passive pipes that simply move money to active intelligent layers that manage data and credentials in real time.”

This model reflects a gradual transition toward composable infrastructure, in which payments capabilities can be layered and adjusted as business requirements change. Systems that once executed transactions in sequence are being redesigned to interpret data, manage credentials and optimize routing decisions in real time.

A Structural, Not Cyclical, Shift

Underlying these developments is a conceptual change in how payment processors define their role.

“For a modern payment processor like EPX, ‘always on’ is no longer optional,” Patel said. “It’s a structural requirement to remain competitive in 2026 and beyond.”

The company is investing in what it describes as “active vaulting,” replacing static repositories of card information with systems that automatically update credentials and deploy tokenization without requiring merchant intervention. EPX is also exploring artificial intelligence to guide transaction routing and approval optimization. Such tools analyze multiple variables simultaneously, seeking to increase authorization success while controlling processing costs.

The industry’s future may therefore depend not on the speed of individual transactions but on the capacity of payment ecosystems to operate quietly, reliably and adaptively beneath them.