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Insights and Expertise

Four analysts, one Put two of these analysts on opposite sides of a deal and
the comparison becomes an artifact of method rather than
statement, four a fact about the merchant. Nobody lied. The number sim-
ply is not reproducible, and the merchant has no way to
tell.
honest answers Why the informality held, and why it is ending

For three decades this was survivable, because statement
analysis was a craft. The assumptions lived in the ana-
lyst's head, and when a merchant or a competitor pushed
back, a person could say what they had counted and why.
Informality held because a human always stood behind
the number.
That is what is changing. Statement analysis is increas-
ingly performed by software: parsers, spreadsheets that
outlive whoever built them, tools that return a rate in sec-
onds.

This is not a forecast. NMI acquired Fee Navigator in June
2026, citing a knowledge base built on more than 100,000
merchant statements. U.S. Bank said in May 2026 that its
in-house analyzer had processed more than 30,000 state-
ments in the preceding year. This publication covered AI
By Daniel Wilson Kemp statement analysis as early as October 2021. The technol-
Lifted Holdings ogy is not new to anyone reading this; what is new is its
share of the work.
and the same merchant statement to four
experienced analysts and ask each for the Software does not carry an assumption in its head. It en-
effective rate. You will get four numbers, codes one. An assumption nobody wrote down is no lon-
H each reached through a defensible calculation. ger a craft judgment; it is a defect that scales silently across
None of them will be dishonest. every merchant it touches, and cannot be cross-examined.

Consider a restaurant month: $250,000 in gross settled There is precedent for the fix, though not here. The U.K.
purchases across 5,000 sales, $6,500 in net processing Payment Systems Regulator directs the largest acquirers
fees after a $99.85 rebate, $6,000 of refunds and $1,500 of to give merchants a summary box of specified informa-
chargeback principal, and $484.85 of monthly, PCI and tion and to run an online quotation tool. The EU Inter-
equipment charges that do not move with volume. Fees change Fee Regulation makes acquirers itemize the mer-
are withheld daily, so deposits land at $236,000. chant service charge, interchange and scheme fees by card
category and brand unless the merchant asks in writing
The first analyst divides net fees by net deposits and re- for blended pricing.
ports 2.7542 percent. The second divides gross fees by
gross volume, never touching the rebate, and reports What has never existed on the U.S. side is a processor-neu-
2.6399 percent. The third divides net fees by gross volume tral, openly published methodology stating how a state-
and reports 2.6000 percent. The fourth counts only the ment audit is computed. I can find no industry body that
volume-driven fees and reports 2.4061 percent. publishes one, and no commercial tool I reviewed does
either.
Nearly thirty-five basis points separate the highest from
the lowest. Apply the highest and the lowest to the same Declare the basis before the arithmetic
$3 million of annual volume and the gap is worth rough-
ly $10,400. The merchant paid $6,500 either way—what The remedy is not better analysis. The arithmetic was nev-
moved was the reported rate, and with it the size of any er hard. The remedy is declaring the basis first.
savings a competing proposal can claim without stating a
single false number. Start with the denominator. Use gross settled purchase
volume and its matching settled count. Do not substitute
Which is why the analysts I trust stopped arguing about net deposits, funding totals or authorization volume: re-
rates years ago and compare dollars and cost per transac- funds, chargeback principal, reserves and loan repay-
tion instead. That instinct is right, but dollars only com- ments all move deposits without changing the cost being
pare when both sides counted the same charges over the measured.
same period, and that is the part nobody wrote down.
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