Payment Testing: The High Cost of Low-Quality Data

Payments Testing

Steve Gilde May 31, 2024

6:01

No one really knows who first used the term “The devil is in the details”, but the idiom certainly applies when talking about financial services and is especially true when it comes to the test data used in payment processing.

Whether a financial transaction is for ten dollars or ten thousand, its messages must be correctly formed, parsed, and processed, as well as contain accurate data.

Low-quality test data can lead to processing failures and a variety of negative consequences - anything from a dropped transaction (and an unhappy customer) to higher interchange rates, increased chargebacks, compliance issues, and even fines or penalties.

When it comes to payment processing, it is critical that all industry participants recognize the importance of working with current and accurate data.

“For financial services, the importance of data quality cannot be overstated. It is the backbone for risk management, regulatory compliance, customer satisfaction, operational efficiency, and competitive advantage. Investing in high-quality data isn’t just an operational necessity; it’s a strategic imperative.”

- Atlan

Quantifying the Impact of Bad Data

The impact of low-quality data can be quantified in several key areas that are critical to the health and well-being of any organization:

Added Cost

Recent research from Gartner found that poor data quality destroys business value, with surveyed organizations believing that poor data quality is responsible for an average of $15 million per year in losses.
Increased Risk and Compliance Issues

"Poor data quality can lead to poor product quality… and missed opportunities for compliance. Organizations must ensure that they have current, accurate, and complete data so they can make informed decisions on compliance issues."
Decreased Productivity

“Data quality directly impacts the efficiency of day-to-day operations. Clean and accurate data reduces the time and resources spent on data verification and correction. It minimizes errors in transaction processing, billing, and customer communications, thereby lowering operational costs. Inefficient operations due to poor data quality not only increase expenses but also negatively affect customer service.”

- Atlan

Strategies for Better Test Data Management

Now that you have a better understanding of how low-quality test data can impact your business, let's look at ways your organization can improve its test data management practices.

Leveraging technologies - such as Paragon’s innovative testing software - that support centralized management of test data, provide robust automation capabilities, enable integration with other enterprise systems, and facilitate communication and collaboration among all stakeholders will help streamline payment testing operations.

The result? This will save your business saving time, money, and resources, all while helping you to increase customer satisfaction.

Here are a few key ways to improve payment data quality:

Centralized Test Data Management: A centralized database where test data can be easily imported, exported, filtered, and shared becomes a “single source of truth”, ensuring that everyone in testing operations has access to accurate information.
Automation: Aggressive use of testing automation helps ensure that all required tests are run consistently and accurately every time, maximizing test coverage and minimizing the chance for human error.
Integration: It is no longer acceptable for payment testing operations to exist as a silo within an organization – they must be integrated within the broader enterprise. APIs facilitate the seamless exchange of test data, reports, and results, with other systems, such as a CI/CD pipeline.

How Paragon Application Systems Helps Improve Test Data Quality

Industry research has shown that "firefighting bad data" is a significant drag on resource efficiency.

That’s why Paragon has specifically designed our solutions to help clients address poor test data management practices that “are bottlenecks to productivity and erode the confidence of software engineers regarding the quality of their products”.

We work hard to ensure that our simulators are current with the latest industry mandates so that your resources won’t need to pore through updated specification documents or technical bulletins to see if network changes affect your environment.

Paragon can also provide “Test Suites” that contain both test cases and associated data that represent detailed message and transaction processing scenarios for various card brands and network formats.

Data: Your Most Valuable Asset

“Poor quality data weakens an organization's competitive standing and undermines critical business objectives.”

- Gartner

The cost of ignoring data quality in payment processing is too high to overlook. Not only does poor payment data quality negatively impact quality and productivity, it increases both cost and risk, which can erode public trust and affect shareholder value.

Financial services companies must adopt a proactive approach to data management to safeguard their operations against the risks posed by inadequate data practices. By implementing the strategies discussed, businesses can enhance their data integrity, improve service delivery, and maintain competitive advantage in the rapidly evolving financial sector.

Paragon offers a suite of solutions specifically designed to address the challenges of managing test data in the payment industry. Our solutions can help improve data quality, and streamline testing processes, increasing both testing accuracy and resource productivity.

Need help in improving the quality of your test data? Get in touch with us today. Our team of payment system testing experts are here to help.