Smart routing is the shorter, everyday name for smart payment routing: software that decides, for each transaction, which acquirer, processor, card network or payment rail should handle it. The main entry describes how routing engines work and how merchants deploy them. In payments, the term almost always refers to this automated decision rather than to network routing in the technical sense.
A smart routing engine weighs factors such as the expected approval rate, processing cost, speed, currency and the health of each connection. It may send a domestic card to a local acquirer, a foreign card to a cross-border one, and fall back to a second provider if the first declines or times out, a technique related to payment gateway failover. It is broader than least-cost routing, which optimises mainly for price, and different from debit routing, which concerns the choice between networks available on a single debit card.
Merchants usually access smart routing through a payment orchestration platform or a payment gateway connected to several acquirers. Its value depends on having more than one route available and on good data about how each route performs.