Payment outages threaten over $44 billion in sales

Payment system failures are putting at risk $44.4 billion in U.S. retail and hospitality sales every year. This is according to a new study from FreedomPay and AI-powered analytics platform company Dynatrace, in partnership with the consultancy Retail Economics.

Drawing on the findings of surveys of both consumers and businesses, the study revealed that payment failures are no longer isolated incidents; they're part of a recurring operational challenge that disrupts service, damages customer trust and impacts revenue. U.S. businesses are reporting an average of five major outages every year, with 63 percent occurring during peak trading periods, amplifying the financial impact, the study noted.

"Consumer-facing businesses in the U.S. are navigating an increasingly treacherous landscape," said Chris Kronenthal, FreedomPay president. "From widespread outages and connectivity issues to the fragility of existing payment infrastructure, disruption has become a constant. The environment creates a perfect storm for significant revenue loss and long-term damage to customer loyalty and brand reputation."

The frequency and cost of disruptions varies by state, but five states in particular account for 40 percent of at-risk revenue, despite the fact that the five states—California, Florida, New York, Texas and Washington—represent roughly 35 percent of the U.S. population.

A report detailing study findings, Payment resilience in an uncertain world draws on surveys conducted in November 2025 of 5,000 U.S. adults and 200 retail and hospitality store and venue managers in those five states.

Patience wears thin

Retail accounts for $37.7 billion or about 85 percent of total at-risk revenue, the report stated. Not surprisingly, the more tills, devices and counters a business has the greater the exposure when systems fail.

Most customers are willing to tolerate brief delays of up to seven minutes. "Resolving payment disruptions within seven minutes prevents more than 90 percent of potential losses," the report noted.

But after seven minutes customer patience wears thin. And that's bad news because payment disruptions in the United States tend to take hours to rectify, not minutes. Businesses forfeit roughly $1.2 billion in sales per minute of downtime ranging from eight to 13 minutes. By the 23-minute mark, cumulative losses can hit $5.3 billion, wiping out 70 percent of all at-risk revenue, according to the report.

The report goes on to explain that businesses misgauge the ability and willingness of customers to use cash when electronic payment systems fail. Fewer than 30 percent of Americans carry cash when visiting stores or restaurants, and many of those who don't (28 percent) would not be inclined to find a nearby ATM during a payment system outage and then return with cash in hand to complete a purchase.

The key to containing disruptions is investing in layered, reliable backup solutions, which, among other things, can prevent short outages from escalating, the report stated.

"This research shows that payment disruption becomes a business problem long before it is uncovered as a technical one," said Philippe Deblois, global vice president of solutions engineering at Dynatrace. "When payment systems fail, time is the most expensive variable. In complex environments, delays happen when teams can't quickly see where a problem starts or how systems are connected. Customers don't wait for that clarity. They leave, and revenue is lost within minutes."

Reputational risks costly

Beyond the financial impact, payment system failures expose brands to significant reputational damage among digitally savvy consumers and contribute to 60 percent of managers reporting verbal abuse toward frontline staff.

"Our research shows that the financial impact of payment outages is significant, but the erosion of consumer trust and brand loyalty can cause equally devastating damage," said Richard Lim, CEO at Retail Economics. "Investing in robust infrastructure and the ability to proactively observe potential points of failure is essential for safeguarding future growth, maintaining a competitive edge, and prioritizing long-term consumer preference."

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