Q&A – Why now is the time for merchants to review their card acquiring arrangements

19th March 2018
William Downes
William Downes

At CMSPI, we’ve helped clients across Europe struggling to understand card acquiring invoices up to 6,000 pages in length. These opaque and complex documents are difficult to navigate, and when combined with the uncertainty surrounding upcoming fee increases and fluctuating charges, can mean merchants are missing out on significant savings and historical rebates.

Can you tell us a little bit about the invoice auditing services provided by CMSPI?

Invoice auditing and ongoing monitoring is an important part of our services. We have lots of long-standing clients who use our monthly invoice auditing service to make sure they stay on top of any industry changes and anomalies in their card processing invoices. Some invoices, depending on your charging structure and supplier, can be hundreds or thousands of pages long, and many internal teams just don’t have the resource to devote to regularly review their invoices. Our team helps many merchants across Europe to quickly identify and resolve any inaccuracies or misapplied charges.

Can you talk us through a typical holistic card review project?

First, our clients and their suppliers provide us with copies of contracts and invoices for the past 12 months. Our team then conducts a thorough invoice audit – presenting any miscalculations or historical errors. After we present to the client, we then liaise directly with our client’s suppliers to correct any mischarging and ensure that any historical rebates are paid promptly. We also provide ongoing monitoring which allows our clients to ensure their arrangements are future proof.

What kind of issues does an invoice audit typically expose?

It can vary, which is why it’s important to conduct a holistic review on a regular basis. Some of the more common issues we’ve uncovered include misallocation of scheme fees, historically inaccurate charges, discrepancies between contract rates and invoice rates, fee miscalculations and inflated line item charges. The added benefit of what we can do is benchmarking your arrangements against peers and the wider market to provide a clearer understanding of how optimized their arrangements are.

Another key issue that invoice audits tend to expose is that merchants can’t rely on their suppliers to communicate important updates with them. We’ve seen many examples where acquirers have passed on new and amended fees without any communication to the merchant at all. It’s important that merchants be proactive and stay up to date with any changes to the industry, their contracts, SLAs and invoice costs.

Where do these errors usually occur, is there a specific line item or area of the invoice merchants should be aware of?

This is a great question and is part of the reason why finding these inaccuracies is often so difficult. They can be hidden in obscure places or blended in with other charges. At CMSPI, we audit every area relevant to your payments supply chain. This might include: interchange costs, scheme fees, acquirer margins, payment gateways, terminals, hardware costs, IT costs, FX costs and gift cards to name just a few.

What would you say are the four main benefits of an invoice auditing project with the CMSPI team?

I would say the key benefits would be: better visibility of your arrangements, low internal resource requirements, ongoing advice and support, and most importantly – substantial savings. Some of the clients we’ve worked with have benefited from six or even seven-figure savings due to back-dated rebates and charging inaccuracies.

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