How to Prepare a Merchant Portfolio for an Acquiring Pricing Review

Define the decision before assembling the data

Write down what you want the review to establish. Are you testing the economics of a stable group of merchants, looking for a channel for a particular category, or considering where to place future business? These are different questions. Combining them into one headline volume can obscure both the opportunity and the work required.

• Existing portfolio: identify the part of the book you are authorized to discuss, and keep transfer feasibility separate from pricing potential.
• Selected segment: explain why this group belongs together and why it is the focus of the review.
• Future business: label volumes and merchant counts as forecasts, with the assumptions behind them.
• Mixed objective: split the request into separate coverage and economics workstreams rather than asking for one rate for dissimilar activity.

Do not use processing volume as a substitute for profitability. The OCC's bank-focused merchant-processing handbook considers fee income, operating costs and losses in assessing profitability. The preparation framework below is an advisory approach, not a regulatory checklist or a universal acquiring-bank requirement. Office of the Comptroller of the Currency: Merchant Processing, Comptroller's Handbook: August 2014, amended March 2025

A useful objective might be: 'Compare the recurring economics of this established domestic e-commerce segment, while leaving other categories and any migration decision outside the initial review.' It gives a prospective relationship something specific to evaluate.

Build a baseline that another person can reconcile

For a practical starting point, use three completed months of actual activity and add a longer view where seasonality or recent changes matter. This is a preparation suggestion, not a required history period or an underwriting threshold. A newer portfolio can still be described honestly; distinguish the available history from projected growth.

• State the reporting dates, currency and source of each aggregate.
• Define volume precisely, such as settled purchase value before refunds, and use that definition consistently.
• Separate purchase counts, authorization attempts, refunds and other billable events where the information is available.
• Define an active merchant consistently and distinguish unique merchants from accounts, locations or merchant IDs.
• Calculate average purchase size as total purchase value divided by purchase count for the same period.
• Keep actual results, estimates and forecasts in separate fields, with unknown information visibly marked.

Keep an internal reconciliation back to the source reports, even when the first discussion uses only rounded ranges. If one report covers calendar months and another covers a different statement cycle, resolve or explain the mismatch before comparing them. If your volume measure is net of refunds, do not combine it silently with a purchase count that excludes refund events.

A change in the book can matter more than its average. Flag a merchant that left, a major new account, a product change or a move toward recurring billing. Show both the historical result and the current scope so the recipient does not price activity that is no longer representative.

Group merchants by the differences a review needs to understand

Use groups that help explain pricing or coverage, not just the labels in a sales spreadsheet. Relevant distinctions can include the actual product or service, merchant entity location, customer markets, payment channels, billing model, fulfillment timing and service needs. Keep individual merchant identities out of the initial summary.

Avoid flattening distinct businesses into a broad high-risk label. A finished cosmetic is different from a research-use-only product, and a clinic is different from a pharmacy or research supplier. An AI or SaaS label alone does not describe the service, billing model or acquiring requirements. Record the relevant facts rather than assigning risk from a fashionable category name.

If reliable dispute or refund information is available, preserve the period, event definition and denominator. A portfolio-level calculation you produce for comparison should not be represented as a card-network monitoring ratio. Ask the reviewing party which definitions it needs before treating those figures as comparable.

Use a small, readable snapshot instead of a merchant directory

The following is a fully fictional one-month portfolio. It is not an MBA client portfolio, an acquiring offer or a forecast. The figures illustrate how merchant count, volume and transaction count reconcile; a real review should also show the reporting history and material qualifications.

The total average purchase is $3,000,000 divided by 45,000 purchases, rounded to $66.67. It is not the simple average of the three group averages. State that calculation so a reviewer can distinguish a real change in transaction mix from a spreadsheet mistake.

This snapshot still needs context. The general retail group might be the initial pricing-review candidate. The supplement group might require a separate coverage discussion. Future SaaS placements might be evaluated without moving the existing subscription accounts. Those possibilities should be labeled as proposed review scopes, not assumed merchant eligibility or agreed transfers.

Add short notes about material exceptions without identifying the merchants. If one account represents a large share of a group, flag concentration at an appropriate level rather than hiding it inside an average. Where a group is so small or distinctive that the description could identify a merchant, use broader ranges or defer the detail to an agreed private review.

Keep the cost detail ready for the appropriate stage

An opening inquiry does not need a confidential pricing agreement or a merchant-level statement export. Once the scope, recipients and permissions are agreed, a useful economics review connects the activity summary to the relevant revenue and costs. That connection helps explain why two proposals that look similar can produce different results.

• Separate fees actually collected from fees billed but not yet collected.
• Identify known pass-through costs, provider markups, per-event charges and recurring account costs without counting any item twice.
• Record the contractual basis of the ISO share and any deductions needed to reconcile the residual.
• Separate recurring charges from one-time credits, setup costs or temporary concessions.
• Include additional servicing and transition costs in the decision model, while keeping them distinct from the provider's residual calculation.
• Show unavailable or unverified information as an open question, not as a zero-cost assumption.

Do not copy an entire agreement into a general inquiry just to answer one pricing question. Identify the relevant term, check whether you are permitted to share it, and arrange the appropriate review. The companion guide on buy rates and net residuals provides a worked comparison once the cost definitions are clear.

For mixed currencies, keep original-currency totals available. If you also produce a reporting-currency summary, state the exchange-rate source and date or averaging method. A currency conversion made for analysis is not evidence that the proposed relationship supports that settlement currency or that FX costs are included.

Share information in stages, with a clear purpose

Start the MerchantBridge inquiry with your own name, firm and contact details, the review objective, broad categories and approximate activity. Do not include merchant names, websites, merchant IDs, bank information, patient information, card data or confidential agreements in that initial message. MerchantBridge Advisors: High-risk merchant placement for ISOs and agents: portfolio economics

For a later review, agree who needs the information, what decision it supports and what you are authorized to disclose. Request the appropriate secure delivery method before sending records. Limit the material to what is relevant, and retain any key connecting coded rows to merchant identities under your own control unless a specific, authorized disclosure is needed.

• Check the actual file contents, including hidden worksheets, comments, filenames and document properties, before sharing.
• Remove unnecessary identifiers and use grouped information or ranges where precise values could reveal a merchant.
• Keep customer-level and patient-level information out of this business review; do not send raw payment-card data.
• Make material gaps or exceptions visible without disclosing more detail than the current stage requires.

Removing a name does not automatically make a file anonymous or establish legal or PCI compliance. PCI SSC's guidance on card data arriving through unintended channels reinforces the need to prevent inappropriate capture or further propagation; it is not an endorsement of sending payment data for a pricing review. PCI Security Standards Council: What should a merchant do if cardholder data is accidentally received via an unintended channel?

Ask for an answer that preserves the scope and assumptions

A useful response identifies the merchant groups considered, the proposed commercial basis, the costs and responsibilities included, and the questions still open. Keep excluded activity visible. If a proposal only addresses the general retail group, do not present its economics as though they apply to the entire fictional $3 million portfolio.

• Which part of the book or future pipeline was actually assessed?
• Which pricing assumptions are confirmed, conditional or still unknown?
• What documents or clarification would the next stage require?
• What servicing, technical or contractual work could affect the decision?
• Could the opportunity be pursued through future placements or a selected segment instead of a whole-book move?

Reviewing an opportunity does not authorize account transfers, customer contact or changes to merchant agreements. Those steps require their own permissions and feasibility checks. Agree any next stage and timing for the specific opportunity rather than assuming a standard approval or migration timetable.

Open the discussion with one clear objective

Using the fictional portfolio above, an initial inquiry could say: 'Our ISO serves approximately 60 merchants across general retail e-commerce, supplements and SaaS, with about $3 million in monthly purchase volume. We would like to explore a pricing review for the general retail segment first. We are not proposing a whole-book transfer, and existing contractual and technical constraints still need review. We can prepare an anonymized summary once we agree the scope.'

That introduction gives MerchantBridge a decision to help frame without exposing a merchant directory. From there, the conversation can establish whether the relevant path is portfolio economics, additional coverage, future placements or further preparation before approaching a prospective relationship. Any opportunity and commercial terms remain case-specific. MerchantBridge Advisors: High-risk merchant placement for ISOs and agents: portfolio economics

Questions & answers