Transforming Acquirer Profitability: Our Collaboration with SRM.

At Eris Intelligence, we are excited to announce the launch of “Transforming Acquirer Profitability”, a report by SRM that we were proud to collaborate on. The report lands at a time that acquirers continue to struggle with compressed margins due to rising operational costs, regulatory pressures, and constantly altering scheme fees.

What if? The economics of better data.

The report demonstrates that the acquiring industry has the potential to recover up to $1 billion in operational costs over five years, plus an additional $3–5.5 billion in recovered fees through more accurate data that is currently difficult to retrieve.

Many acquirers still rely on aggregated reporting and complex reconciliation exercises involving manual processes to understand these costs. The new study from SRM shows how this leads to under-recovered fees, revenue leakage, and limited visibility of the actual profitability of merchant accounts.

Early results already illustrate why full visibility of costs matters. For one mid-sized European acquirer, SRM and Torus improved annual scheme fee recovery by €4 million – approximately 10% of its total scheme fee costs.

According to SRM and Torus, the answer lies in moving from aggregated reporting transaction-level profitability intelligence. This means being able to establish, at both transaction and merchant level:

• Actual transaction cost
• Scheme and interchange fees incurred
• Accuracy of costs recovered
• Accuracy of settlement reconciliation
• Actual areas of profitability
• Areas of revenue leakage
• Where pricing should be adapted

Thanks to this improved management information, leadership can make informed strategic and commercial decisions.

New solution makes tangible difference

The new SRM/Torus Acquirer Profitability Solution brings together SRM’s payments advisory expertise with Torus’ transaction-level payments profitability intelligence. It focuses on three areas where greater transparency can translate directly into fee recovery:

• Interchange and scheme fee assurance enables merchant-level calculation and recovery of interchange and scheme fees, helping identify under- or over-recovery and improve billing accuracy.
• Settlement reconciliation provides daily transaction-level reconciliation between schemes and merchant settlement files, greater visibility into variances and stronger financial controls.
• Merchant profitability analytics provides daily profitability analysis across individual merchants, portfolios and segments, giving management better information to support pricing and make commercial decisions.

To explore the economics behind acquirer profitability in more detail, download the new SRM white paper, “Transforming Acquirer Profitability”, which examines the commercial pressures facing acquirers and the potential value that could be recovered through greater fee transparency and transaction-level insight.