First Annapolis released its tenth annual study on common pricing practices in the bankcard acquiring industry. The 2011 Acquirer Pricing Study provides a data-intensive look at pricing strategies for small merchants (<$10 million in annual bankcard sales) and mid-sized merchants ($10–$50 million in annual bankcard sales) in the United States. The study provides unique insights into how acquirers are currently pricing these merchant groups.
The 2011 Acquiring Pricing Study provides key insights into pricing methods and trends. The analysis confirms that acquirers continue to rely on an increasing number of unbundled fees. This trend is more prevalent in the small merchant segment than in the mid-sized merchant segment. In addition, the study provides an initial assessment of the impact of the Durbin Amendment on acquiring pricing. The analysis looks at the effects of Durbin on pricing for non-interchange plus merchants and interchange plus merchants separately. The study shows that acquirers are passing through a significant portion of Durbin-reduced interchange on PIN debit and signature debit. The study also shows that small merchants benefit the least from Durbin-related savings due to their pricing structure, which tends to be tiered or downgrade pricing. In addition to insights on 27 different fee types, the 2011 Acquirer Pricing Study looks at settlement types, value-added service fees, and mobile acquiring service fees.
Figure 1: Number of Fees Charged to Small Merchants with <$10 Million Annual Bankcard Sales and Mid-Sized Merchants with $10–$50 Million Annual Bankcard Sales (U.S. Market)
- Historical and summary analysis of industry price points for 27 separate fee categories.
- Fee levels and pricing structures for 3 types of PCI fees.
- Time series data for specific fee types.
- Detailed fee data for small and mid-sized merchants.
- Additional data on value-added services, mobile acquiring, and the effects of Durbin.
27 Total Fees Assessed
- Card-Specific Transaction Fees
- Authorization Fee
- Chargeback Fee
- PCI Compliance Fee
- Gateway Fee
- Monthly Minimum Fee
In the fourth quarter of 2011, First Annapolis surveyed 16 acquirers representing more than 40% of industry volume. The survey assessed acquirers’ pricing strategies, acquiring fee levels, value-added services pricing, emerging technologies services pricing, and the impact of Durbin on acquiring pricing. The survey data set is segmented into two merchant groups: small merchants with <$10 million in annual bankcard sales and mid-sized merchants with $10–$50 million in annual bankcard sales. The 2011 Acquirer Pricing Study analyzes and summarizes this data set. We maintained strict anonymity of the survey subjects during the entire process as well as in the report.
