What is Smart Routing? | Payments Glossary

Smart Routing (also called intelligent or dynamic routing) is a payment orchestration capability that uses machine learning to select the optimal processing path for each transaction in real-time.

The routing engine evaluates multiple factors including BIN-level historical approval rates, acquirer latency, cost optimization (interchange routing), currency matching, and geographic proximity. Smart routing can improve authorization rates by 3-15% and reduce processing costs by selecting local acquirers over cross-border routes.