A Bank’s Success in Recovering Network Fees with the Support of PayIP
Our client, a reputable and respected bank offers a wide range of financial services to its customers, including credit and debit card issuing and acquiring.
Despite its size and reputation, our banking client acknowledged its difficulty to fully understand and manage the complex network (Visa & MasterCard) fees associated with its card processing services.
Banks are charged assessment fees by Visa and Mastercard. These fees are either fixed fees or a percentage of the transaction amount or are variable based on the volume of transactions of the bank, and they are used to cover the cost of maintaining the payment infrastructure, including the cost of compliance with industry regulations.
Banks are also charged other fees by Visa and Mastercard, such as annual fees, BIN fees, ICA fees and set up fees, that are used to cover additional services such as chargeback management and fraud protection.
Different fees are charged weekly, monthly, quarterly or annually. Add in cross border, foreign exchange and all the payments jargon and it can be completely overwhelming for a banks accounting department.
Visa and MasterCard have literally thousands of different fee events, codes and descriptions.
The bank felt that in this complexity there may be billing errors and that it was potentially paying more than it needed to on network fees to Visa and Mastercard. That’s when they decided to engage the services of PayIP, a global payment and billing specialist.
The team at PayIP performed a thorough analysis to gain an understanding of the Bank’s payment architecture, data and billing. PayIP deployed its proprietary software technology coupled with its billing and data specialists and analysed network invoices together with the bank’s host data and discovered several errors in the networks billing process.
PayIP was able to identify, highlight and explain these discrepancies to Visa and Mastercard and to ultimately recover the overpayment on these network fees for the bank.
The bank was able to recover significant amounts of money in network fees, as a result of the work done by PayIP.
Additionally, PayIP identified services that were correctly billed by the networks but that were not required or being utilised by the bank saving the bank further monies moving forward.
The bank was extremely satisfied with the results that PayIP was able to achieve. They recognized PayIP’s ability to understand the complexity and nuances of network fees and the expertise in correctly applying the rates and discounts, which helped the bank to recover a significant amount of money.
The bank has seen the value in having a specialist payment and billing expert like PayIP to continue to review and manage their network fees, in order to minimize any overpayment.
In conclusion, this case study highlights the importance of understanding and managing network fees associated with issuing and acquiring card processing services. It demonstrates how a financial institution like this bank was able to recover a substantial amount of money by working with a specialist payment and billing expert like PayIP. The bank was able to reduce its costs and improve its bottom line, all while being able to focus on its core business of growing customer numbers.
