Acquirers have a profitability problem, and it’s not their fault. You’ve seen first-hand how secretive card schemes can be, providing the bare minimum of information and leaving you guessing on the rest.

In fact, it’s so bad that some merchants may even be making you a loss, and you know nothing about it.

The truth is, without cost breakdowns for every transaction, you’re left in the dark.

And without the right pricing tools to segment and price merchants based on those criteria driving those transaction fees, there’s nothing you can do about it anyway.

Which is why we’re so excited to team up with Torus,giving you access to not only the most accurate merchant profitability analysis available, but the pricing tools to take advantage of your new insights and increase your profitability.

The Profitability Gaps

Every transaction comes with a cost. And according to the generalized bills that arrive from card schemes, those costs are all lumped into one neat monthly payment. But you know that’s not true.

Each transaction comes with a unique set of different fees based on merchant location, card type, industry, and many more categories.

But without access to information how much you got charged for every individual transaction, you’re left grouping merchants together into large pricing buckets, missing out on pricing optimizations as well as leaving profit on the table simply because your scheme costs are not optimized.

But the problem goes even deeper than that.

By grouping merchants together in such large, undefined groups, you end up undercharging a portion of your clients.

And  overcharging others to compensate.

And that is an even bigger problem.

Because what would you do if you were being overcharged by a service provider?

You would shop around.

And your merchants are no different. Meaning that many of those overcharged merchants will leave once they find a better offer, harming your revenue. And because you are left with a higher proportion of merchants whom you undercharge, your profitability takes an even bigger hit.

Finding the gaps

The first step to solving this problem is understanding the costs on each transaction. Even if that data is not provided by the scheme.

We’re delighted to have partnered with Torus, whose deep knowledge and understanding of card scheme data allows them to allocate, with 98% accuracy, the fee on every transaction.

You are now able to see exactly how much each transaction has cost, what the drivers were and make predictions on merchant costs based on that data.

Plugging the gaps

The new data and insights you get from Torus’ system allow you to understand your profitability gaps. The Pricing Engine allows you to fill those gaps.

Working alongside your existing infrastructure, the Pricing Engine enables you to introduce new pricing parameters your current system simply does not provide, create pricing tiers based on volume hurdles, and price any combination of objects you want: transaction criteria, card criteria,cross-selling or financing criteria, and so on.

Now your clients can be priced a lot closer to the cost that you incur from the card scheme, improving your profitability on previously unprofitable merchants and increasing retention rates among merchants you were previously overcharging.

And all of this without costly and time-consuming custom developments or breaking apart existing infrastructure.

The Future of Merchant Pricing

Your profitability is suffering. Without understanding your scheme costs, and without the tools to adjust your pricing on a granular level,you will continue to lose profitability.

By combining the insightful data and clarity of Torus with the flexible pricing offered by the Nova Pricing Engine, you can escape this trap, plug your profitability gaps, and increase client retention, all the while integrating seamlessly with your existing core IT systems.

By pricing a lot closer to cost, you find the perfect balance between profitability and merchant retention, allowing you to both better serve existing customers and increase your bottom line.

Get in touch today and discover exactly how we can close those profitability gaps together.

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