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Smart Invoicing: Customizable Automated Fees for Every Merchant

Smart Invoicing: Customizable Automated Fees for Every Merchant
Business Development Specialist
Yuliia Mamonova

Invoicing, though seems easy, can be a very complex issue (and a real money drainer, too). And even so, in the digital era of unlimited payment possibilities, major payment giants offer only the basic functionality in this regard: they either facilitate per-transaction fees or offer fees that depend on the merchant’s individual sales volume. 

However, payment service providers working with various merchants need a more sophisticated system to be able to charge different fees for different business types, niches, and sizes. Thankfully, there is a ready-made solution with built-in smart invoicing powered by a reliable white-label payment processor. We’ll talk about that later on.

But first things first: what’s smart invoicing? 

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What’s smart invoicing? 

Smart invoicing is the technology that allows payment providers to set customizable fees for each individual payment action. This means that processors can establish different fee structures based on the merchant’s industry, business type and size, etc. In other words, instead of doing it the conventional way – by charging a fixed percentage off each transaction – they can set up fees triggered by various payment actions.

What's smart invoicing?

For instance, a payment processor can have a fixed fee for each declined transaction that would differ from the fee charged for a successful transaction. The list goes on. Charges will vary depending on the payment channel or an action performed. 

The list of fees is truly unlimited. Here’s just an intro: 

  • Weekly / monthly / annual fee; 
  • Setup fee;
  • Transaction fee;
  • Chargeback fee;
  • Dispute management fee;
  • Refund fee;
  • Decline fee;
  • Fee based on the merchant’s sales volume, etc.

Above are the most common ones. But there’s many more to them.

These fees help payment processors charge the right amount of funds from each merchant to cover up all the expenses and resources used. But since businesses and their needs vary, so must the fees applied to them.

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Why payment processors need smart invoicing

  1. Reduced cost.
    Smart invoicing has fee structure flexibility at its core. It allows to adjust the applicable fees based on the merchant’s sales volume or a transaction type. As a result you get to reduce costs significantly.
  2. Beat the competition.
    Reduced costs automatically lead to increased customer loyalty and higher lead-to-client conversion rates. Besides, payment processors with implemented smart invoicing get to strengthen their reputation as the payment technology innovator. And a strong reputation goes a long way when it comes to growing your clients base.
  3. Suitable for both low and high-risk businesses.
    Smart invoicing meets the needs of both low and high-risk businesses.
    For instance, a chargeback fee might not be in the fee structure of a low-risk online business. But a high-risk merchant will almost 100% find it in his agreement. The thing is that chargebacks happen to high-risk businesses much more often (hence the name).Therefore, processors aim to protect their funds by charging a fixed cost for every chargeback that comes the seller’s way.
  4. Automated customizable charges.
    We know that not too many payment processors offer smart invoicing. Therefore, the notion is often viewed as overly complex. The truth is, though, the technology behind smart invoicing (I’m speaking for Ikajo International here) is easy to use. The system collects all the fees in a single invoice and does all the calculations automatically for you. No muss, no fuss.
  5. More clients.
    With all this flexibility on the table, you can now accept more clients for processing. Easily. Simply create a customized fee structure that would meet both your and client’s needs. Thanks to smart invoicing, you can now expand your business.

why payment processors need smart invoicing

Which white-label payment processors offer smart invoicing?

Ikajo International is among the top few ones worthy the attention. And here’s why:

  • Flexibility is our first name (with reliability being the middle one).
    We can offer you a per transaction fee or set up customizable fees for particular payment actions. We look into each case to identify what will best fit our and client’s needs. And above all else, aim to be flexible with our terms.
  • Cost reduction.
    As mentioned above, the desire to cut costs within all the secure measures is our guiding light. So, if the payment processor collaborates with two or more acquirers, our system will help him identify which channel is the most efficient for a particular type of transaction or other payment trigger.
  • Automation.
    You don’t need a technical degree to set up the fee structure for your client. We took care of it all. The system gathers all the fees in an invoice and calculates them automatically.
  • Choose what to charge your clients for.
    You can predefine what actions you want to charge the merchant for. For instance, you might offer a high-risk client monthly, chargeback, and dispute management fees. In the meantime, you won’t charge these fees off a low-risk business owner.

The list goes on. So, if you’re interested, drop us a line! 

And we have more payment juice prepared for you next week. Stay tuned!

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