What components does transaction processing cost include? Knowing the correct answer to this seemingly trivial question may be the key to effective cost reduction strategy. Many companies face significant problems when it comes to transaction cost reduction, because they resort to the most obvious solutions, focusing on the transaction processing cost itself. They negotiate better processing terms with their partners or search for new processors offering “better” terms. In fact, there are much more costs linked and related to transaction processing than one can keep in mind. Tokenization and gateway fees, plus indirect and opportunity costs are also, in a sense, essential components of transaction processing cost. Only careful analysis of all the listed components (and not just the transaction processing cost itself) can result real savings for your company.

A detailed description of transaction processing cost reduction problem and potential solutions is provided in the respective article on Paylosophy.