by Matt Rej
Key Takeaways:
- Most businesses do NOT need a backup payment processor.
- Occasional downtime can happen, but extended outages are extremely rare.
- Dealing with multiple processors complicates things and unnecessarily increases your costs.
The recent Rectangle Health outage has caused chaos for businesses relying on this practice management bridge for payment processing.
Systems have been down for weeks, forcing healthcare operations to scramble for alternative solutions while simultaneously looking for ways to prevent something like this from ever happening again.
It’s a huge story. And it’s even causing merchants who are unaffected by the outage to ask themselves whether it’s worth having a backup credit card processor.
The short answer is no, you don’t need a backup processor.
I’ll explain why below.
Modern Payment Technology is Very Reliable, and Prolonged Downtime is Rare
Being a merchant consultant gives me unique access to insights that the general public simply doesn’t have. We work with thousands of businesses who use hundreds of different payment processors, which include unique setups through integrated APIs relying on multiple providers.
We almost NEVER hear from our clients that they’re unable to accept payments due to a processor-related outage.
The recent situation with Rectangle is unprecedented. And nothing like this has ever happened in my career. It honestly made me curious as to what the longest outage was prior to this, and nothing else even came close.
Examples of Other Major Payment Outages
These are really the only other recent outages that affected a large number of businesses for an extended stretch. And in most cases, we’re talking about hours as opposed to days or weeks:
- Square Outage – September 2023: Square was down for roughly 15 total hours between September 7-8, 2023. In-person terminals were able to accept payment data in offline mode, which was processed when systems came back up. But online processing was down for about 24 hours, and the culprit was later identified as Square’s DNS servers.
- TSYS and Shift4 Outage – August 2021: TSYS was down for about 2-3 hours on August 21, 2021, which also affected Shift4 systems relying on TSYS. This short outage made big headlines because it occurred during events at cashless stadiums.
- Capital One and FIS Outage – January 2025: An outage at FIS Global caused banking and payment processing issues between January 16-18, 2025. This was mostly banking and deposit-related, though some businesses were impacted by the inability to accept card payments.
- Cloudflare Outage – November 2025: Cloudflare, the most popular CDN in the world, was down for a few hours on November 18, 2025. This outage affected several payment processors, including Stripe and PayPal, as well as financial tools like Xero and QuickBooks.
Have there been other instances where businesses have been unable to get paid due to processor downtime? Of course.
But nothing major. Payment processing outages are about as likely as your website going down temporarily or your internet being unavailable for a couple of minutes.
Why You Don’t Need a Backup Payment Processor
The idea behind having multiple payment processors or a backup processor seems reasonable in theory. But when you start to look at the logistics and cost behind making that happen, it’s not really worth it.
- Most businesses won’t ever be impacted by a major outage.
- Maintaining multiple merchant accounts is not easy or necessary.
- Routing payment volume through a second processor can reduce your leverage in getting good rates with your current provider.
- Your backup processor will likely impose monthly minimums, meaning you’ll pay for a service you’ll likely never use.
- Existing equipment may not work with the backup processor.
- You’ll also be hit with additional monthly service fees, annual fees, and other miscellaneous charges that can amount to thousands per year.
- Switching to your backup processor during an outage would be a logistical nightmare.
- By the time your backup is ready to accept payments, your main processor will likely be up and running.
Think about how this would work for you right now.
Your payment system is fine, and you’ve been using the same processor for years with no intention of switching. But you want to go out and get a second merchant account.
New application, full underwriting, second merchant agreement, more equipment, and extra costs associated with everything. And now what? Are you going to plug in backup terminals or integrate a second gateway into your current system?
Most likely those devices will just be sitting on the sidelines for years. In the rare case you actually need them, you’ll be relying on staff to configure devices they’ve never seen before.
There are just too many holes in this type of setup. In the rare event that your processor goes down, chances are they’ll be back up before you know it.
Isn’t it Better to Be Safe?
For Rectangle Health users affected by this outage, I get it. You’ve probably had a lot of sleepless nights over the last two weeks.
So I totally understand why you’d want to have some type of failsafe option moving forward.
But using the logic of a backup processor, you might as well have a backup of everything.
Backup web host, backup bank account, backup accounting software, backup phone system, backup internet provider…you get the idea. It just doesn’t make sense.
There’s a reason why processors and gateway providers typically include uptime guarantees of 99.9% or more in their SLAs.
They aren’t expecting downtime, and they’re willing to compensate you in the event that systems are temporarily offline.
How to Protect Your Business From These Types of Incidents Without a Backup Processor
Instead of having a backup processor, I urge you to take a moment to truly understand how your current payment setup actually works.
This is especially true for those of you using an integrated setup where your processing comes through a third-party software (like practice management from Rectangle).
So many businesses that I consult with don’t really know what’s happening behind the scenes.
In the case of Rectangle Health, they aren’t even a payment processor. While payment processing is built into their software, they rely on Vantiv as the backend processor. Vantiv is owned by Worldpay (which is now under the Global Payments umbrella).
There’s no outage at Vantiv, Worldpay, or Global. The outage came from BridgePay, which the gateway Rectangle uses to facilitate the payment connection within its software.
This type of setup is extremely common with all types of different third-party software providers that aren’t actually payment processors. We see this with dental practice management tools, vet practice management software, hotel management systems, field service management software, and more.
Providers need to take more responsibility for setting up redundancy to prevent these types of incidents. As the reason for outages is rarely on the actual processing side.
And you need to evaluate how many different players you want involved with your payment setup. The more APIs and connections needed for things to work smoothly, the higher the chance of a failure somewhere along the line.
Final Thoughts
Getting a backup processor is overkill, and I don’t recommend it. So try not to panic and worry about something that probably won’t impact your business.
If you’re affected by a major outage, your processor should be able to set you up with a short-term workaround (like Rectangle has done with the NMI gateway).
But if you want to be proactive, take the time to truly understand what’s happening with your payment processing stack.
The more you understand, the greater chance you have of being able to control your costs — something that’s far more likely to affect your business than an outage.
So rather than focusing on a problem you don’t have, shift your gears to something you’re impacted by right now: rising merchant fees. That’s a problem affecting every business, and it’s worth more of your time than preparing for the sky to fall.