When your ISO needs to adjust agent payouts prior to paying out residuals, residuals templates should be used. Residuals Templates are a tool for applying payout adjustments to selected users beyond their split percentage. They contain rules for re-calculating the item pricing based on ISO-defined formulas that use the information in the processor's monthly residuals report.
Examples of pricing adjustments use cases include:
- Creating hierarchical configurations of multi-level payouts such as agent + manager + referral partner.
- Increasing or decreasing the income or expense of reported fields.
- Calculating residuals based on contractually set agent buy rates.
- Exclusion of defined income or expenses based on processor.
- Applying income and expenses for in-house products and services sold.
Residuals calculations for each income and expense are driven by a column on the processor's residuals report which itemizes the ISO’s own cost to the Processor. As reporting detail can vary by processor, some adjustments cannot be calculated if the base information is not included in the processor's residuals report. Make sure that your ISO is familiar with costs being charged by your Processor. For certain adjustments, you will need to know where your Processor’s buy rates can be found in order to validate the calculations of your Residuals Templates.
Merchant Central recommends completing some planning prior to configuring your residuals templates.
To assist in this step, you may use the Residual Template Planning Tool.
Creating a Residuals Template
1.To create a new residuals template, go to Residuals -> Residuals Management -> Template and click on the “Add a New Template” button:
2. The Template Form popup will appear where you can enter the name and select the desired Processor to which the template will be applied.
3. To add a new rule to your Residuals Template, select the desired Revenue / Expense Field using the dropdown. This is the column from your report that your adjustment will be using.
4. The available income and expense fields visible in the dropdown are pulled from the configured processor mapping.
5. Select the specified Action, described below, that you need to perform for the selected Revenue/ Expense Field. Additional Revenue and Expense Fields should be added to create your Residuals Template:
Below are some use cases where you would adjust your agent’s Income/Expenses according to their schedule A.
TYPE |
Use Case |
Select Report Field |
Select Merchant Central Action |
Enter Value |
Example |
Original Value |
New Value |
Network / Risk Fees |
Increase from 2BPs to 5BPs |
Discount Rate |
Multiply by |
0.0005 BPs |
Sales Volume $10,000 |
$2.00 |
$5.00 |
Increase Amex Discount Rate from 8 BPs to 10BPs |
Amex Discount Rate |
Multiply By |
0.001 BPs |
Amex Volume $12,000 |
$9.60 |
$12.00 |
|
Increase V/MC/DISC/Amex/ Debit Authorization Preferred from $0.03 to $0.05 |
Preferred Authorization Expense |
Multiply by |
$0.05 |
1,200 preferred transactions |
$36.00 |
$60.00 |
|
Increase V/MC/DISC/Amex/ Debit Authorization Non-Preferred from $0.06 to $0.09 |
Non-Preferred Authorization Expense |
Multiply by |
$0.09 |
650 non-preferred transactions |
$39.00 |
$58.50 |
|
Increase VISA/MC/Disc/Transaction Fee from $0.02 to $0.08 |
V/MC/Disc Transactions Fee Expense |
Multiply by |
$0.08 |
1,500 V/MC/Disc Transactions fee count |
$30.00 |
$120.00 |
|
Increase Debit per item fee from $0.03 to $0.05 |
Debit Expense |
Multiply by |
$0.05 |
500 Debit Count |
$15.00 |
$25.00 |
|
Increase EBIT per item fee from $0.03 to $0.05 |
EBT Expense |
Multiply by |
$0.05 |
450 EBT Count |
$13.50 |
$22.50 |
|
Monthly / Per Occurrence |
Increase Chargeback from $10 to $15 |
Chargeback Expense |
Multiply by |
$15.00 |
Chargeback count 3 |
$30.00 |
$45.00 |
Increase Retrieval Fee $10 to $15 |
Retrieval Fee Expense |
Multiply by |
$15.00 |
Retrieval Fee count 7 |
$70.00 |
$105.00 |
|
Increase On File Expense for Agent |
On File Fee Expense |
Multiply By |
$7.50 |
On File Fee $5.00 |
$5.00 |
$7.50 |
|
Increase Batch Close Expense |
Batch Close Expense |
Multiply By |
0.001 |
Amex Volume 12,000 |
$9.60 |
$12.00 |
|
Agents get paid on 90% of the Net Income |
Net Income |
Multiply By |
0.9 |
Net Income $100 |
$100.00 |
$90.00 |
|
Agent receives 50% of Income Item |
Batch Header Income |
Multiply By |
0.5 |
Batch Header $4.20 |
$4.20 |
$2.10 |
|
Exclude PCI Revenue from agents |
PCI Revenue |
Replace with |
$0 |
PCI Revenue $90.00 |
$90.00 |
$0.00 |
|
Exclude Revenue from the agent. |
Monthly Minimum |
Replace with |
$0 |
Monthly Minimum $12.00 |
$12.00 |
$0.00 |
|
Exclude Annual Fee Revenue From Agent |
Early Termination Fee |
Replace with |
$0 |
Early Termination Fee $25.00 |
$25.00 |
$0.00 |
|
Flat Rate To Agent |
Manager Fee from $0.00 to $5.00 |
Agent Net |
Decrease By (Value) |
$5 |
There is no Manager Fee of $0.00 |
$0.00 |
$5.00 |
Monthly Bonus $0.00 to $10.00 |
Agent Net |
Increase By (Value) |
$5 |
There is no Monthly Bonus of $0.00 |
$0.00 |
$10.00 |
|
Decrease Agent Net By Charge Back Income |
Agent Net |
Decrease By Field (Income Chargeback) |
$35 |
Agent Net $350.00 |
$350.00 |
$315.00 |
Multiply By
The multiply by the rule will multiply the selected column by the desired value. Then the Merchant Central will calculate the difference between the original value and the value after the rule has taken place.
- If the PIN Discount Expense was $20.00, and you multiplied by $0.05 the expense will decrease from $20.00 to $1.00 ($19.00 reduction in expenses).
Increase Per Transactions By:
- You can increase income or expenses by a value based on the transaction count established in the mapping.
- If Transactions for a merchant were 150 and you would like to increase income by $0.02 a transaction. You would increase total expenses by $3.
Decrease By OR Increase By
- This rule will allow you to increase or decrease the original value by the number in the Value field.
- Note* that this would increase/decrease all values such as Negative, Positive, and Zero values within the Report Field by desired values.
Replace With:
- This rule will allow you to replace all original values with the desired values in the Value/Field.
- Note* that this would replace all values such as Negative, Positive, and Zero values within the Report Field with desired values.
Modifying a Template
To modify an existing template, go to Residuals >Residuals Management>Template and click View Existing Templates:
After you have finished updating your template click Save. The “Rev.” (revision) number will update, which helps in confirming which version is applied to the users.
Important: After modifying a template, you will need to use the "Apply Latest Revision" action (checkmark icon) in order for the updated template to take effect on future residuals for the users who had the previous version.
Template Actions
Each template has certain actions that you can utilize.
Navigate to Residual>Residuals Managment> Templates> View Existing Template. Here you would be able to see the various template actions
Edit Template
Here you can edit a template that already exists.
Delete Template
If you no longer need to use a template you can delete the template from the View Existing Templates. This will not affect residuals in the past.
Apply Latest Revision
When you make any adjustment to the template you may apply the "latest revision" of the template to a desired month and year. This will apply the most recent changes to the template to all users that had the previous version of the template.
Show Template Logs
Any changes made to the template can view viewed within the "Show Template Log".
Copy Template
You can copy an existing template to contain the same rules and adjustments. This will create a duplicate template in your system here you can adjust the fees. This way you wouldn't need to start from scratch if you need to create similar templates.
Assigning a Template to a User
To assign a template to a user go to Residuals >Residuals Management>Templates, select the month and year from which the templates will start to apply, and click Change:
Next, find the user you wish to assign the template to and click on the preview icon for that user:
You will be directed to the templates page for that user. Click Apply New Template:
In the popup which appears, select the Processor’s name from the drop-down list, and select the template which will be applied to the users:
If applicable, also select the SysPrin from the drop-down list (depending on which processor was selected) and select the Mark as Persistent checkbox (if the template should be applied to all future months):
When finished click Apply, and the template will be assigned to the user.
Note: If the user manages other users and any of the subordinates need the same template, select the checkbox next to the users’ names in order to apply the template to them as well.
Assigning a Template to Multiple Users/Processors
In order to assign a template to multiple users go to Residuals >Residuals Management, on the Bulk-Assign Templates tab, and select the users using the checkboxes next to their names (or by using the Group and User Class filters):
After you've selected the required users, select the month and year from which the templates will start to take effect, select one or more processors, and finally select the template to be applied to the users:
Optionally, you may select the Mark as Persistent checkbox if the template should be applied to all future months.
When finished, click Apply (N users), and your template will be assigned to the selected users.
Viewing the Pricing Adjustments
If an item pricing has been modified using residual templates, then such a change will be reflected in the residual reports.
When an Administrator views the Sales Rep's residuals, they will see an info icon in the report header, which indicates that the report was modified using templates.
By clicking on the info icon, additional info icons will be displayed in the income or expense columns next to the accounts that were modified.
In this scenario, you can see that this user has a template named SALESTEST, Rev.1 that increases the Total Expenses of his merchants by $10.
You can view a detailed breakdown of these adjustments within the Detail Tab.
The House View of the same account will display the account with the Income, Expense, and Net as they were reported on the uploaded residuals report.
The user's percentage is reflected in the House View as the actual percentage that was paid to the user AFTER the template modifications took place.
Additional Notes:
- Only Administrators have access to modifications of templates under House View and when viewing other users from the drop-down list.
- The House View of the accounts will show the actual percentage paid to the user after templates and/or other modifications have been made.
- When the template adjusts a revenue column the CRM will keep the Total Income number unchanged and instead it will apply the changes to the Expense calculation, in order to maintain the data integrity.
- The rules are applied according to the following order of precedence:
- Apply Revenue and Expense column rules.
- Apply TotalRevenue and TotalExpense rules.
- Apply Net rules and compensate the TotalExpense field.
- Apply Manager Global Splits if they exist.