It is becoming increasingly obvious to me that the Global and Regional card payment processing organisations have their sights set, if not on world or territorial domination, certainly on ever increasing size and scale. Where organic growth fails to deliver to aspirations, smaller operations are routinely acquired.
Assuming this trend continues, and there is nothing apparent for it not to, there are going to be some super, mega, heavyweight processing organisations serving multiple clients, regionally and globally, across their own systems with increasingly less traffic needing to be routed via the international card scheme networks. It is not inconceivable either that 2 super processors could establish system linkages that would disenfranchise the card schemes still further.
Now, if this all comes to pass what is going to be the effect on Visa and MasterCard scheme fees, a decent proportion of which are contributed by network processed volume. Sure they will still have assessment fees and other service and ancillary fees, etc. but for the schemes, fees are essentially a zero sum game, i.e. define what revenue is wanted/needed then spread that across the suite of products, services, assessments, volumes, etc out to the membership.
Well, I am led to believe that many scheme members already consider that the fees charged by the international schemes are too high and don’t deliver real value for money, so increases there to offset lower processed volume could be tricky. Maybe the answer will lie in reducing expense. If I was a member of both schemes I probably wouldn’t object to a diminution in the competition between the schemes for the right to sponsor major international sporting events using my money.
PayX Business Consulting and Advisory Services includes a scheme fee health check and an independent, objective review of scheme fee monitoring and management processes within organisations to keep those costs under strict control.