How we read a card processing statement

Name: Ovlo
Address: IE

The method, in enough detail that you can judge it before you send us anything.

The number we are trying to establish

Everything starts with your effective rate.

Take every euro that leaves your business in connection with accepting cards over a given period — every percentage fee, every per-transaction charge, every monthly line, every annual charge apportioned across the year. Divide it by your total card turnover for the same period. Express the result in basis points, where one basis point is one hundredth of a percent.

That single figure is the only one that compares across providers, across pricing models and across time. A headline rate does not, because it excludes whatever sits outside it. Two businesses quoted the same headline rate can be paying materially different effective rates, and usually are.

Most merchants we speak to have never seen this number for their own business. Their provider has no particular reason to calculate it for them.

What an effective rate is actually made of

A worked example at 130 bps. Illustrative only — not client data.

Interchange42 bps · pass-through: Paid to the bank that issued the card. Your provider collects it and passes it on.
Scheme fees18 bps · pass-through: Paid to Visa and Mastercard for running the networks. Revised twice a year.
Acquirer margin48 bps · negotiable: What your provider keeps. The part a blended rate hides most effectively.
Fixed costs22 bps · negotiable: Terminal rental, gateway, PCI, admin and minimum monthly charges.

Two of the four components are pass-through and cannot be discounted by anyone. Knowing where the pass-through cost ends and your provider's margin begins is the difference between a real conversation and a sales pitch.

Why we split it four ways

An effective rate on its own tells you what you pay. It does not tell you what to do about it. So we break it into four parts, because each part behaves differently and responds to a different kind of action.

InterchangePass-through

Paid to the bank that issued your customer’s card. Your acquirer collects it and passes it on; they do not keep it and cannot discount it.

Interchange is capped by EU regulation at 0.20% for consumer debit and 0.30% for consumer credit. Those caps are the reason interchange is often assumed to be a solved problem. It is not, because a significant share of the cards presented to an Irish merchant fall outside the caps entirely.

You cannot negotiate interchange. You can change what you pay in interchange, by changing how transactions are captured and processed. Those are different things and the distinction matters.

Scheme feesPass-through

Paid to Visa and Mastercard for running the networks. Dozens of separate charges — some percentage-based, some fixed per transaction, some applied only in particular circumstances. They are revised twice a year, in April and October.

Also not negotiable. But they are checkable, and scheme fee changes are routinely passed through with a margin added on top, which is checkable too.

Acquirer marginNegotiable

What your provider keeps. This is the part that is genuinely a commercial negotiation, and it is the part that a blended rate is most effective at concealing.

Fixed costsNegotiable, and frequently avoidable outright

Terminal rental, gateway fees, PCI compliance charges, minimum monthly service charges, statement and admin fees, chargeback handling fees.

Individually small. Multiplied across a fifty-site estate and twelve months, not small at all.

Why the split is the whole point

If you do not know how your rate divides, you cannot tell a good offer from a bad one.

A provider who cuts their margin and quietly moves you onto a pricing structure that increases what you pay in scheme fees can show you a lower headline rate and a higher bill. It happens, and without the split you have no way to see it.

The split also tells you where the work is. If your margin is already thin, negotiating harder will not achieve much and the money is somewhere else — in configuration, in the terminal estate, in fees that should not be charged at all. If the pass-through cost is what is out of line, the answer is operational rather than commercial, and no amount of renegotiating gets you there.

What we look for

These are the findings that come up repeatedly. Every one is real and every one is checkable against your own statement.

Terminals billed after they were decommissioned

A site closes or re-fits, the hardware goes back or goes in a cupboard, and the rental line carries on. Nobody notices, because nobody receives an invoice.

PCI non-compliance fees

Charged monthly when a self-assessment questionnaire has not been completed. Entirely avoidable — the questionnaire is administrative rather than technical for most merchants. This fee is pure penalty for paperwork not done.

Card-present transactions routed as card-not-present

A point-of-sale configuration error means transactions taken with the card physically present are processed as though they were taken online. Card-not-present carries materially higher interchange and higher fraud exposure. Invisible on the shop floor and obvious in the data.

Commercial and corporate cards

Excluded from the EU interchange caps and costing several times what a consumer card costs. If you serve businesses — hotels taking corporate bookings, wholesale, trade counters — the mix matters, and it is worth knowing what proportion of your turnover it represents.

UK-issued cards used online

Since Brexit, a UK-issued card used in a card-not-present transaction with an Irish merchant carries interchange of 1.15% on debit and 1.50% on credit, against 0.20% and 0.30% for Irish and EEA consumer cards. If you take online bookings from UK customers this is a real line in your cost base, and it is rarely visible under blended pricing.

Authorisation misuse fees

Charged when an authorisation is never cleared or reversed within the scheme’s window. Endemic in hotels and restaurants, where pre-authorisations are taken at check-in or on opening a tab and then never properly closed off. The fee is small and the volume is not.

Duplicate compliance and admin fees per merchant ID

In a multi-site estate the same monthly charge is often applied separately against every merchant ID, whether or not the underlying service is delivered separately.

Blended pricing

One rate for everything, interchange invisible inside it. You cannot audit what you cannot see, which is the point of the structure.

Locking a baseline before anything changes

This is the part that separates a documented saving from a claimed one.

Before we implement anything, we agree a baseline with you in writing: your effective rate and your cost by component, over a defined period, on your actual volumes. You sign it off. It is a rate, not an absolute figure — so if your card turnover grows twenty percent next year, the baseline still holds, and nobody gets to book volume growth as a saving.

Everything afterwards is measured against that baseline. A saving is the difference between what you would have paid at the baseline rate on this period’s volumes and what you actually paid. It is arithmetic, and you can check it.

Without a baseline agreed in advance, any savings figure is unfalsifiable. That is precisely why the industry norm is not to agree one.

Implementation

We do the work rather than handing you a list.

Depending on what the audit found, that means correcting point-of-sale and gateway configuration, reconciling the terminal estate against what is being billed, getting the self-assessment questionnaire completed, removing charges that should not be there, consolidating or rationalising merchant IDs, and where it is warranted, running a properly structured commercial negotiation with your existing provider or a competitive process across several.

Switching providers is one possible outcome. It is not the default, and it is not the objective.

Ongoing management

Card processing cost does not stay fixed once corrected. It drifts back.

Monthly reporting against the locked baseline: Effective rate, cost by component, variance, and an explanation for any movement.
Scheme fee change tracking: Visa and Mastercard revise their fees twice a year. Every revision is an opportunity for a change to be passed through inaccurately or with margin added. We check each one against your statements.
Estate monitoring: New sites, closed sites, replaced terminals, changed configurations. Each one is a chance for the same problems to reappear, and they do.

What this costs

A one-off setup fee, a monthly retainer scaled to your card volume, and a share of savings we can document against the agreed baseline.

Pricing scales with card volume. We will send you the full breakdown on request — ask and you will have it the same day.

The audit itself is free, and it stays free regardless of what happens next.

The audit is the way to judge this

Reading about a method is not the same as seeing it applied to your own numbers.

Send your statements

No charge, no obligation, and the analysis is yours to keep.