In the four-party card payment ecosystem, every participant has a revenue model and every participant bears costs. For a full overview of how money moves through the ecosystem, see Revenue Models: Making Money in the 4-Party Card Payment Ecosystem.
Among those costs, one stands out as particularly difficult to manage: payment network / scheme fees.
Payment network fees are the charges levied by payment networks on their principal members: issuers and acquirers. They are the primary revenue source for card networks and typically represent 10-50 basis points of transaction value. But unlike interchange fees, which follow relatively well-understood rules, scheme fees are a broad and evolving set of individual charges.
Recent data from the UK Payment Systems Regulator (PSR) shows that payment network fees have increased by around 25% in recent years, outpacing the actual payment volumes.
The anatomy of a payment network fee
Payment network fees are triggered by a range of factors that are not always transparent to finance and card operations teams. They generally fall into several categories:
- Message processing: Fees for routing authorisation messages (including declined transactions).
- Assessment fees: Charges for the right to participate in the network rails and use the scheme's infrastructure, typically a percentage of transaction volume.
- Cross-border triggers: Higher fees triggered when the issuer and the merchant are in different countries.
- Tokenisation and digital enablement: Fees associated with tokenisation for Apple Pay, Google Pay, and other digital wallets.
- Security and compliance fees: Charges covering fraud monitoring, chargeback-related costs, 3D Secure authentication fees, dispute resolution fees, data security charges, and penalties for non-compliance with network rules or exceeding chargeback and fraud thresholds.
Payment network fee structures have grown in scale & sophistication
The challenge with payment network fees is their complexity. Payment networks continuously add new fee types, update the assessment logic that determines which fees apply to which transactions, launch optional services (some enabled by default), and expand programmes for security and digital payments.
The result is a complex and evolving cost structure where finance teams often find it difficult to clearly see what each fee relates to, what drives it, and whether it might be avoidable. It can also make it harder to track fees with confidence, allocate them to the right product or customer, explain them to stakeholders, or recover costs by passing fees through to others via pricing.
Consider how fee changes are communicated through scheme bulletins. A bulletin might announce that a particular fee is now set at €0.05. But interpreting what that change means commercially requires knowing the previous rate, the transaction volume it applies to, and how it interacts with other fees. That €0.05 could be a modest adjustment or a material increase, and without systematically tracking fee history alongside each bulletin, the distinction is easy to miss.
The challenge is self-reinforcing: as scheme fee structures grow more complex and assessment logic changes with every bulletin cycle, many organisations gradually lose visibility into what they are being charged for.
The consequences of inaction
When payment network fees are not actively governed, a few patterns tend to emerge:
- Rising cost per transaction. Without monitoring, the cost can gradually increase as networks introduce new fees and adjust existing ones.
- Unused optional services left active. Some services are enabled by default when they launch. These might include analytics tools, fraud scoring systems, authentication services, or open banking integrations. If an issuer does not proactively monitor their scheme bulletins to opt out of services they do not need, these avoidable costs remain active indefinitely and compound over time. For a deeper look at how auto-enrolments and missed opt-out deadlines drain budgets and what finance teams can do about it, see Taming the multitude of scheme fees: How finance teams can take back control.
- Incomplete cost allocation and pass-through. Attribution depends on a clear understanding of what each fee covers and what drives it. Where that understanding is missing, fees default to unallocated overhead, and the opportunity to recover them through pricing is lost. The result is gradual margin leakage.
Who should own this?
Scheme fee governance is inherently cross-functional. It touches finance, operations, compliance, product, and technology. This breadth is part of what makes ownership difficult to pin down. When responsibility is distributed, accountability often ends up diluted.
Some issuers are now assigning a single accountable owner for network fee economics. A single individual has the mandate and the expertise to turn payment network fees into a managed cost line. In practice, this means:
- Tracking fee changes systematically by proactively managing scheme bulletins, identifying governance gaps, and acting on cost-out opportunities before they compound.
- Separating required vs. optional fees to determine if services are truly necessary.
- Measuring fees in basis points (where 10 basis points = 0.1%) per transaction to accurately track trends and compare them over time.
- Attributing fees to products or clients to understand true product-level profitability.
- Linking fees to operational drivers to identify the underlying factors in your operations that generate those costs.
- Establishing consistent pass-through rules for transparency, internal forecasting, and the ability to predict scheme fee costs for the next quarter.
- Reducing avoidable behavioural fees triggered by excessive authorisation requests, poor data quality, late clearing, fraud & chargeback fees.
Some organisations have begun creating dedicated roles for exactly this purpose. It reflects how scheme fee governance is becoming a distinct area of responsibility.
How Rivero helps
Managing scheme fee complexity manually is becoming difficult to sustain. Rivero’s Kajo platform is designed to centralise scheme updates and provide a clear framework for compliance and fee tracking. By automating the filtering of relevant rules and highlighting opt-out deadlines, it ensures that issuers only pay for the services they use.
The upside of getting this right is meaningful. For organisations formalising governance, a 7-15% reduction in scheme fee costs is achievable with structured governance of payment network fees, clear ownership, and a disciplined approach to separating what is mandatory from what is avoidable.