Paddle launches Paddle Pilot to boost payment acceptance for fast-growing B2B SaaS companies

Paddle, the Revenue Delivery Platform for B2B Software-as-a-Service (SaaS) companies, today announced the launch of Paddle Pilot, a new set of features that helps businesses increase their payment acceptance and capture more revenue. With Paddle Pilot, fast-scaling SaaS businesses can maximise the success of their payments internationally, avoiding payment failures that commonly result in lost revenue and poor customer experiences.

The Hidden Costs of Payment Failures

The SaaS industry has continued to thrive throughout the Covid-19 pandemic, generating over $105 billion in revenue in 2020. Yet, for many fast-scaling SaaS businesses, poor payment acceptance is hampering revenue growth — often unknowingly. When a payment is made, through a checkout or recurring subscription payment, that payment passes between issuing and acquiring banks around the world, changing currencies, and passing through fraud and authentication checks. These checks are essential security measures, but they can also lead to false positives, leaving genuine customers unable to complete a payment. These failed payments are a major cause of lower checkout conversions, increased subscriber churn and stunted revenue growth. In 2021, losses incurred from false payment declines are expected to reach $443 billion, which is nearly 70x more than losses from fraud, itself. These losses are set to grow, with 62% of online merchants reporting that their false decline rates are increasing.

To date, software sellers have had two options when it comes to payment acceptance. They can set up a single acquirer to handle payments, which limits available payment routes and increases the chance of payment failure. Alternatively, they can build internal solutions, which can often prove time consuming and costly, while also requiring continuous optimisation. Companies that create their own solution also have to integrate multiple payment providers and set up merchant accounts around the world, often having to establish new business entities locally and hire people on the ground in the process.

Reliable Revenue, Renewed

Announced today at Paddle Forward, Paddle’s virtual customer event, Paddle Pilot solves this problem for SaaS sellers by intelligently routing all payments between multiple acquiring banks around the world to return the best possible payment acceptance. Pilot has already driven increased acceptance by as much as 4% for Paddle Sellers. Its global, multi-acquirer infrastructure — established as part of Paddle’s existing Managed Payments feature — means that Paddle Pilot can select from, and cascade between, more routes than any individual payment provider can offer:

• From checkout transactions to recurring subscriptions, each payment is routed to the acquiring bank most likely to succeed. Pilot looks for similar transactions amongst millions of historic payments to make this choice.
• In the event a payment is unsuccessful, Paddle Pilot instantly cascades the payment to the next best choice to maximise the likelihood of finding a successful route to payment acceptance, capturing more revenue.
• A dedicated Paddle team of payments engineers, product managers and data analysts works hard to test different configurations to return the largest impact on successful payments and revenue.
• As Paddle’s Managed Payments deals with a high transaction volume and keeps chargebacks low, Paddle’s merchant accounts are much more trusted with banks, meaning payments through Pilot are more likely to be accepted through the chain than if a seller sets this up themselves.

Thanks to Paddle Pilot, one software seller, Resume.io, saw an increase in successful payments in January, which resulted in an additional $47,000 in revenue. Over the course of the year, this would equate to capturing around $600K in new subscriptions and recurring payments.

Christian Owens, CEO and co-founder of Paddle, said, “The very nature of software businesses means that they can expand internationally and rapidly scale from day one, even in the middle of a global pandemic. At Paddle, we see first-hand that the things that limit the growth of SaaS companies often have very little to do with the quality of the product. It’s the operational challenges, including poor payment acceptance, that inhibit growth. With Paddle Pilot, we enable software companies to achieve better payment acceptance and capture more revenue. Unlike single payment service providers, our purpose-built solution both routes and cascades between multiple acquirers around the world to return the best possible payment acceptance for SaaS sellers, driving their growth as a result.”

Introducing: Paddle Sandbox

Paddle also announced its new Sandbox at Paddle Forward, a testing environment that lets software companies experiment with their Paddle setup to see the impact that proposed changes will have on customer experience. With a free Sandbox account, Paddle sellers can test new billing models, upgrade paths or adjust checkout design in a virtual set-up before they make changes to their site. Paddle Sandbox makes it easy for sellers to optimise their revenue delivery setup over time, without risking disruption to a live implementation or customer experience.

Paddle’s Sandbox also allows sellers to simulate an unlimited number of successful or failed payments through the use of ‘fake cards’. This means sellers can test the end-to-end customer experience with no negative impact on revenue reporting, performance metrics, or real payment methods.

Upgrading Branded Checkouts

Paddle has also unveiled updates to its Branded Inline Checkout, a flexible embedded checkout that can be designed using more than 50 styling options. The updates include a range of seven new system fonts for even more control over sellers’ branding to ensure that Paddle sellers can create visually attractive, embedded checkouts that match the style of their surrounding sites, making the checkout process feel more seamless and safe.

By combining the optimisation benefits of a checkout that’s managed and tested by payment experts, with the flexibility of a brandable checkout, Paddle helps software sellers design a streamlined, embedded checkout experience. Sellers can tweak button sizing, colors, borders and now fonts to create the desired experience and increase conversions.

Both Paddle Sandbox and Paddle’s updated Branded Checkouts will be available immediately following Paddle Forward.

Paddle Pilot, Sandbox and updated Brand Checkouts will be available immediately, and are included as part of Paddle subscriptions at no extra cost.