Collections Cost Optimization
Companies must navigate a complex landscape of multiple issuing banks, card types, and acquiring partners, which complicates the cost management and visibility of digital transactions. Our solution addresses these challenges by enhancing cost visibility, improving reconciliation processes, and optimizing the overall payment collection system. This ensures that businesses can effectively manage transaction fees and operational costs, thereby mitigating potential revenue leakages and aligning with the intricate requirements of the digital payment ecosystem.
The constant innovation in the payments industry has resulted in managing consumer collections and related costs a highly complex and data intensive task. As the wallet share of digital payments continues to expand, organizations need to put greater emphasis on strategic and value-add initiatives which provide greater visibility and comfort on the market dynamics. With hundreds of payment service providers (PSPs) and constant innovation in solutions, organizations often find it difficult to have central visibility across consumer collection sources such as POS (Point-of-Sale), payment gateways, wallets, QR-codes, BNPL (Buy Now Pay Later) and cash. Despite the maturity of revenue reconciliation processes, companies lack effective reconciliation processes and monitoring of costs.
As-is Assessment: We begin by reviewing agreements, SLAs, and assessing the current landscape across geographies. This allows us to consolidate collections data across merchant service providers and quantify the fees paid for each product category and for each bank or merchant acquirer.
Reconciliation & Benchmarking: We assess agreed charges against actual charges levied on all transactions, highlighting discrepancies and identifying leakages for different pay modes. We leverage BI tools to consolidate collections data across all aggregators/banks and perform wallet share analysis to assess the share of business and related costs.
Opportunity Identification: We evaluate possible opportunities of wallet share consolidation with costs and instrument mix shift to optimise costs. We reconcile collections and related charges with SLAs and benchmark charges for each type of pay-mode using external benchmarks and leading practice based on peers and non-peers.
Cost Optimisation: We assist in strategising negotiation and renegotiations with aggregators and banks, and draft claim letters for any refunds on account of non-agreed or inadvertent charges due to incorrect card classification.
Routing Optimisation: We have experience in designing and implementing routing logics to ensure the payment systems provide the highest success rates and uptime, and reduce the costs by routing transactions cost optimally based on the mode of payment.
Monitoring & Enablement: We build a sustainable solution for ongoing monitoring of collections demographics, assurance, and price benchmarks. We additionally provide an option to develop the solution in the client IT environment and provide knowledge transfer and training to end users.
The benefits of our approach are tangible and quantifiable. By adopting a digital cost optimisation framework with price benchmarking, assurance, routing optimisation, and consumer behaviour insights, companies can enhance cost visibility and control over the digital spend. This leads to efficient reconciliation, leakage identification, and informed decision-making, reducing unnecessary expenses and strengthening market competitiveness.
In conclusion, our approach to digital cost optimisation provides a comprehensive solution to the complex challenges posed by the rapidly evolving payments industry. By providing greater visibility, control, and strategic insights, we enable organisations to optimise their digital spend, enhance their market competitiveness, and ultimately drive their business forward in an increasingly digital world.
