How To Turn Residuals Management Into a Competitive Advantage

The Burden of Traditional Residuals Management

Residuals are complex. You likely have different stakeholders with different splits on each account, and you might also have half a dozen or more processing partners sending you different monthly reports. To get accurate numbers, that data needs to be reviewed, combined and used to calculate your earnings and the payouts due to your agents. This process can be a nightmare — especially for payments professionals.

Residuals management drains energy and time — two of your most important resources. If you’re outsourcing it, it drains your budget instead. In either case, manually calculating and managing your residuals puts an unnecessary burden on your company and reduces the resources you have available to serve merchants.

Thankfully, automation makes this process simpler.

Using Automation To Turn Residuals Management Into an Advantage

Forward-thinking ISOs are using automation to turn residuals from a burden into a competitive advantage. Automated residuals systems take in the reports from each of your processing partners, automatically combine them and put all the key information you need just a few clicks away.

The result is a report that shows you data on your net earnings, your financial key performance indicators (KPIs), your agents’ splits and more. If you need more details, you can dig in as deeply as you want at the merchant, agent, processor or portfolio-wide levels.

Having laser-accurate information at your fingertips streamlines everything from budgeting and forecasting to hiring and beyond. It allows your team to save time and effort, while ensuring you can operate strategically. 

A few benefits include: 

• More time to focus on your merchants
• Improved accuracy & data insights
• More reliable residuals calculations
• Faster payouts (to attract top-tier talent)

Automated Residuals Free Up Your Time and Resources

Automated residuals ensure you’ll have more time each month. Everything you need to know is available as soon as your reports are generated, so your team won’t have to waste hours compiling data. That’s time you can shift to doing what you do best — recruiting and serving merchants. 

Whether it’s managing your team, working on strategy or directly meeting with your customers, the time you currently spend on residuals could be better spent elsewhere; automation makes that possible.

If you’re outsourcing, automated residuals will allow you to reclaim your time and the money you spend on third-party reporting. That’s an edge your competitors (who likely still rely on manual processes) won’t have. In an industry as tight as payments, every edge is important.

Automated Residuals Ensure Accuracy and Improve Your Financial Insights

When it comes to turning your residuals data into useful information, there are two big problems with manual calculations. First, it’s easy to make mistakes that undermine accuracy. Second, the density of data makes it difficult to generate deep, valuable insights, so many ISOs never look beyond the surface.

With automated residuals, your monthly numbers become a source of valuable business intelligence. Rather than drowning in a sea of data — most of which you don’t need at any given time — you can get an accurate, clear picture of your ISO’s earnings and performance, at any level, over any time frame you choose, when and where you need it.

Finding the specific information you need is fast and frictionless. The clear, highly visual reporting makes it easy to turn that information into useful conclusions. Whether you’re looking to improve your forecasting, refine your strategy development or check who your top performers are, automated residuals make it easy to understand your business better and make smarter decisions.

Automated Residuals Help You Recruit the Best Salespeople in the Industry

Having great salespeople is a huge part of thriving in merchant services. Since the payments industry is highly specialized, it can be difficult to recruit independent sales agents who are both great at what they do and have relevant knowledge and experience specific to what you’re selling, especially if you’re relying on manual residuals payouts.

For instance, after residuals are released each month, it can take weeks for agent splits to be calculated and payouts distributed. That can be a frustrating wait for agents, made even more frustrating if there is an error in the payment amount. 

With automated residuals, agent splits are calculated immediately and accurately. With a system like NMI Merchant Relationship Management, they can even be paid from the same residuals reporting platform using ACH. That means instead of waiting weeks, you can send out your agents’ payments immediately. You can also give them visibility into the numbers with permissions-based access to the reporting dashboard.

Faster, more accurate payments improve your working relationship and build trust. That makes it easier to recruit talent and to keep your top performers happy, productive and committed.

Improve Accuracy and Accountability With Fee Verification

As an ISO, charging the correct fees is vital. Incorrect fee assessments can cause financial disparities that cut into your bottom line, making it harder to maintain long-term profitability. Unfortunately, manual assessments are time-consuming and tedious — making it easy for mistakes to slip through the cracks.

This is where fee verification tools come into play. Solutions like NMI Fee Verifier automate the verification process by:

• Identifying the rates you and the processor agreed upon
• Analyzing incoming data for inconsistencies
• Highlighting issues in an easy-to-read report 

The tool quickly and seamlessly verifies that the rates your business is being charged are correct —all without the need for cumbersome manual data analysis.

Automated fee verification tools are especially helpful for ensuring that sales agents are charging merchants properly. For instance, if an agent is undercharging their customers, the tool will highlight any mismatched fees and provide a report so you can handle the issue internally. 

Because fees are so variable, these tools are a great way to ensure your business is passing along the correct rates. They allow ISOs to dive deeper into their data to see exactly which merchants are affected by discrepancies. Then, if the system identifies any issues, your team can easily download a detailed report and submit it to the processor for documentation and pursue repayment.

NMI Merchant Central Makes Residuals a Breeze

Automated residuals management is one of the core functions of Merchant Central — the most powerful payments customer relationship management (CRM) system on the market today. It provides a fully centralized reporting dashboard that puts the real-time and historical information you need at your fingertips in seconds.

If you’re ready to save countless hours, operate more strategically and bolster your relationship with your agents, reach out to a member of our team.