In the United States, the history of bill payments includes several chapters on failed transactions due to payments physically getting lost, particularly during the days when the U.S. Postal Service was a major element of the American financial system. Amazingly, some U.S. companies and individuals still carry out payment transactions by means of mailing checks; for this reason, there is still the possibility of payments getting lost in the mail or when they are manually handled by finance clerks. In the case of online payments, they do not get lost; however, they are still bound to fail in some instances.
User Authentication Errors
Due to the heightened risk associated with digital payments, the process must be handled by various routines that must authenticate the identity of the user and perform a specific function. Let’s say a credit card holder wishes to make an online payment to reduce her debt burden; in this case, the issuing bank acts as the merchant waiting to confirm payment; however, there are other participating systems such as business-to-business collections agencies, gateways, and processors. All these systems must authenticate the user; if one of them suddenly goes offline, the payment could fail.
Insufficient Funds
This is more likely to happen during a purchase, particularly when users manage various currencies in the same account. Let’s say a PayPal card has both U.S. dollars and euros; more than likely, the account will provide the combined amount of both currencies as the available balance, but a merchant may only accept one or the other. For some user, this can be quite confusing.
Dropped User
When using an internet browser to make a payment, users may inadvertently click on the backspace button of F5, thereby terminating the secure session. Depending on how the payment page and the browser interact at that point, the session may be dropped without notice and the user may not realize it. To this effect, a mobile broadband connection switching a network or losing signal strength may also result in a dropped user.
Cipher Mismatch
Online payment transactions are heavily encrypted affairs that depend on certain agreements such as hashing, handshakes and confirmations to avoid fraud and scams. In the case of a virtual currency such as Bitcoin, the confirmation routines are excessive for the benefit of network security, which may result in a delayed, but not necessarily failed, payment.
“Lost payments” is a common excuse used by individuals and businesses that are having trouble paying their bills. According to Weisblatt Law, there are three steps that businesses must take in the case of a failed payment: 1) sending a letter on your behalf, 2) negotiating settlement with the debtor, and if necessary, 3) going to court. If you suspect a scam, take action.
