What is Transaction-based Routing and How Does it Impact Your Business

Transaction based routing - Paytm Super Router

Quick and seamless online payments are indicators of a great customer experience. While several factors are responsible for hassle-free online transactions, payment gateways are instrumental in determining their success to a large extent.

A payment gateway has multiple processes in place to make sure that the money is securely debited from the user’s account for the order to be placed. Essentially, it’s the payment gateway that leads the communication between the website, card network, payment processor, and banks for a successful transaction. All of this occurs within a minute or two and the status of the purchase is updated to the merchant and buyer.

A reliable and robust payment gateway is capable of carrying out hundreds of such transactions in a day. However, a small glitch in this complex task can lead to failure and consequently a bad checkout experience. As much as payment gateways optimise for transactions, there is always a possibility of technical setbacks.

For a business that is looking towards aggressive growth and expansion, depending on a single payment gateway may not be enough.

Importance of multiple payment gateways

One of the most important reasons for businesses to integrate with multiple payment gateways is to mitigate the risk of downtimes and outages. Multiple payment gateways assure that no transaction on your website or app will fail and the checkout experience shall remain uninterrupted.

Having several payment gateways also offers you the flexibility of routing transactions. Payment routing is about distributing the transactions to the optimal payment gateway based on pre-decided parameters.

Why should you route transaction

Once you have integrated multiple payment gateways, routing is the next inevitable step. It is important because routing ensures that the payment gateways are utilised to their maximum capabilities through various combinations and permutations.

Some of the factors that you can take into account while routing are currency, payment type, location, amount and so on. Businesses can decipher their priorities and accordingly distribute the transaction to the payment gateways. This helps in increasing the success of the transactions by solving for any glitch or issue that might arise during a particular payment.

There are varied reasons based on which businesses decide their routing strategy – transaction-based routing being one of the most important ones.

What is transaction-based routing

Transaction-based routing focuses on coordinating between the payment gateways to boost uptime. It plays a significant role in eliminating payment failures.

For instance, a merchant may divide their UPI based transaction in the ratio of 80:20 between payment gateway 1 and payment gateway 2. In case PG1 encounters a sudden failure at a given time, all its traffic is shifted to PG 2 without disturbing the transactions. The earlier ratio is maintained once PG1 is back on track.

In addition to transaction-based routing, depending on the objective a business wishes to achieve, it can set the routing logic and parameters such as:

  • Routing between payment gateways to create a backup mechanism
  • Routing to achieve better conversion
  • Routing through the most economical payment gateway for optimising commercials

What are the benefits of transaction-based routing

Success rate: One of the primary benefits of routing based on transactions is an increase in the payment success rate. If the primary payment gateway is not responding due to technical issues, the payments can be routed to other available options to avert a transaction failure.

Transaction cost: Different payment gateways have varying fee structures for every payment method. With transaction-based routing, businesses can analyse the charges to route transactions and optimise the Merchant Discount Rates (MDR) incurred.

Customer experience: Transaction-based routing certainly improves the online shopping experience for customers. It is especially important to retain your customers since payment failures can deter even the most frequent buyers from shopping at your website.

How Paytm Super Router can help with transaction-based routing

Paytm Super Router is a unique solution to help businesses effectively manage routing between multiple payment gateways by setting smart parameters.

The SaaS tool allows businesses to work with several payment aggregators/gateways while being the point of control for transactions, refunds and settlements. Here’s how Paytm Super Router helps businesses manage transactions:

  • Automates decisions and optimise payments
  • Divides traffic between several payment aggregators
  • Achieves high success rates
  • Lowers operational costs
  • Offers a superior checkout experience

Transaction-based routing through Paytm Super Router focuses on coordinating between the payment gateways to boost uptime. Depending on the aggregator, the performance for a given payment mode may vary. Based on this, businesses can set up routing to ensure that the combinations result in better success rates.


Managing multiple payment gateways can be a hassle for businesses and Paytm Super Router solves precisely for this to ensure a fail-proof mechanism for your transactions. Businesses can decide on their preferred routing logic based on their specific requirements, however, transaction-based logic is a reliable way to avoid failures.

Additionally, Paytm Super Router with its developer-friendly integration, smart features and myriad other benefits offers high success and returns. Switch to Paytm Super Router and give your customers a seamless checkout experience.


Get the Paytm Super Router Today

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