Unexpected cost savings may be hiding in your payment strategy

June 24, 2021

Implement payment optimization solutions to reduce the costs associated with card acceptance with minimal to no investment and very little impact on business operations.


Many business leaders are looking across their organizations to find opportunities to control costs and free up cash for value-added investment. In a recent survey, 66% of companies indicated they plan to pursue cost reduction strategies over the next 12 months, up from just 38% reported before COVID-19. As a result, the typical budget exercise has been turned on its head this year as companies seek to restore, reimagine and thrive. Enduring cost savings strategies that eliminate expenses now, rather than shifting costs to a later date, are gaining favor.

The challenge for financial professionals is to identify quick and effective cost saving opportunities that drive value in months, not years. The good news for many companies is a simple and unexpected opportunity exists within its payment strategy. For many companies, credit card processing costs are the second highest cost behind payroll so identifying ways to reduce them can have a significant impact. Payment optimization offers companies the ability to reduce expenditures and create savings that can be invested in technology and resources to address evolving customer demands, security risks and supply chain management.

With minimal to no investment and very little impact to business operations, companies can quickly implement Payment Optimization Solutions designed to reduce and/or offset the costs associated with card acceptance.


Reduce Costs

Businesses and government agencies that process a large volume of commercial card transactions can reduce related expense through Commercial Card Optimization. Commercial cards include business cards, fleet, corporate, and purchasing cards.

While business-to-business (B2B) companies and government agencies are an obvious fit for the program, any company that conducts B2B transactions with vendors, partners, contractors and service providers can benefit. We work with consumer retail and services companies, universities, and non-profits to help them achieve meaningful cost savings by optimizing their commercial card payments. Commercial card payments are among the most expensive in terms of fees, so businesses can expect the cost of accepting these cards to increase as usage grows. It is possible to reign in these costs with Commercial Card Optimization.

Commercial Card Optimization enables companies of all sizes and types to automate the collection of Level 2 and Level 3 transaction data to qualify commercial card payments for lower interchange rates. Through our program, businesses can realize the full savings potential on every transaction by consistently gathering the data required without creating complex manual gathering processes that encumber staff and resources.

By proactively capturing all the data points necessary to meet Level 2 and Level 3 interchange requirements, our Commercial Card Optimization Service offers our customers a unique savings opportunity. In general, our clients have realized an average of 0.4-1.5% decrease in their average commercial card rate — though this savings can be impacted by a few factors, including rate changes implemented by the card networks. An estimated savings can be calculated by our Payment Optimization Consultants, based on a company’s existing payment data.

Offset Costs

Fee Acceptance Programs are designed to enable businesses, government agencies and higher education institutions to offset or reduce the cost of accepting card payments. We offer three programs that allow organizations to add a small fee to a customer transaction to cover the cost associated with accepting the card payment.

Our Fee Programs Include:

  • Service Fees for Public Sector & Higher Education 
  • Credit Card Surcharge 
  • Convenience Fees

Depending on the program and/or the payment method, the fee may be in the form of a flat fee or a percentage of the transaction. Each Fee Program is regulated by its own set of card brand rules, limitations and requirements which is why it is important to work with a Payment Optimization Consultant to identify a suitable program for your organization.

Our Payment Optimization Consultants work with a seasoned implementation team to ensure the appropriate fee program is implemented in accordance with applicable rules and regulations. The implementation of Fee Programs can be complex, so we take on the heavy lifting of programming, managing and maintaining it for our clients. Our clients reap the cost savings with minimal impact to their operations.


Streamline Currency Conversion

A less obvious opportunity to improve payment optimization and the customer payment experience is Dynamic Currency Conversion (DCC). With the exception of 2020, every year tens of millions of people travel to North America from around the world. As COVID-19 vaccinations and testing continue to increase globally, so will international travel. DCC helps U.S. and Canadian businesses to welcome international travelers.

Prior to completing a purchase, DCC calculates the transaction amount and displays the total in both the cardholder’s home currency and the business’ local currency on the terminal screen. The cardholder has the option to complete the purchase in their home currency or make the conversion before the transaction is submitted for authorization. If they choose to convert to their currency, the conversion is calculated with the current day’s currency exchange rate instead of the exchange rate used post-submission by the card brand or the card issuer.

Each receipt shows the purchase in the business’ local currency, the conversion rate, plus the cardholder’s home currency amount. This makes it easier for international cardholders to reconcile purchases when paying card balances and reduces the likelihood of chargebacks resulting from unrecognized transactions. In addition, our DCC service enables businesses to share in a portion of the conversion fee for each completed DCC transaction creating a new source of revenue.

These are just three ways we help our customers to reduce expenses and better manage the cost of card acceptance. We offer several opportunities to achieve cost savings through Payment Optimization, which may be available to your company based on your industry and/or transaction mix.


You can arrange a consultation with our Payment Optimization team by contacting your U.S. Bank Banker or Relationship Manager.


Related content

Your guide to breaking the rental cycle

4 ways to free up your budget (and your life) with a smaller home

How to build wealth at any age

Retirement planning in the gig economy

A beginner's guide to investing

How having savings gives you peace of mind

Dear Money Mentor: How do I set and track financial goals?

Money management guide to financial independence

Drive digital transformation with payments innovation

Tailor Ridge eBill case study

Buying or leasing? Questions to ask before signing a contract

Home buying myths: Realities of owning a home

How I did it: Turned my side hustle into a full-time job

Want AP automation to pay both businesses and consumers?

Automate accounts payable to optimize revenue and payments

3 types of insurance you shouldn’t ignore

What military service taught me about money management

What is Medicare? Understanding your coverage options

5 steps to take before transitioning your business

Overcoming the 3 key challenges of a lump sum relocation program

Year-end financial checklist

Real-time payments: the next major treasury disruptor

Colleges respond to student needs by offering digital payments

7 year-end tax planning tips

Should I itemize my taxes?

3 ways to adapt to the new payments landscape

Car shopping Buying versus leasing your next vehicle

Allowance basics for parents and kids

6 pandemic money habits to keep for the long term

I own two electric vehicles. Here’s what I’ve learned about buying and driving EVs.

Tips for working in the gig economy

Is it time to get a shared bank account with your partner?

Money Moments: 3 tips for planning an extended leave of absence

Financial gifts can be a valuable – and fun – choice for the holidays

7 things to know about long-term care insurance

Retirement planning strategies for dual-income families

Key milestone ages as you near and start retirement

Higher education and the cashless society: Latest trends

What corporate treasurers need to know about Virtual Account Management

How to open and invest in a 529 plan

Managing the rising costs of payment acceptance with service fees

Your 4-step guide to financial planning

What to do when you lose your job

4 financial considerations before changing jobs

Annual insurance review checklist

How grandparents can contribute to college funds instead of buying gifts

U.S. Bank asks: Transitioning out of college life? What’s next?

3 emerging technology trends for bankers

Friction: How it can help achieve money goals

5 times you may need a financial advisor

For today's homebuyers, time and money are everything

Here’s how to create a budget for yourself

Understanding guardianship and power of attorney in banking

How to use debt to build wealth

8 steps to choosing a health insurance plan

The connection between your health and financial well-being

Is a Health Savings Account missing from your retirement plan?

How to winterize your vehicle

Tap-to-pay: Modernizing fare payments pays off for transit agencies and riders

Take the stress out of buying your teen a car

Financial steps to take after the death of a spouse

Zelle® helps Sunriver Resort make payments efficient and secure

4 steps to finding a charity to support

Estate planning documents: Living trusts vs. will vs. living will

Streamline operations with all-in-one small business financial support

Why ecommerce for small business strategy is integral

Unexpected retirement expenses

6 timely reasons to integrate your receivables

What financial advice would you give your younger self?

How blockchain technology is changing treasury

Blockchain: Separating hype from substance

Enhancing the patient experience through people-centered payments

How COVID-19 is transforming healthcare payments

Ways prepaid cards disburse government funds to the unbanked

Restaurant survey shows changing customer payment preferences

Luxury jeweler enhances the digital billing and payment customer experience

4 ways to make practical use of real-time payments

How to manage your money when you're self-employed

Personal loans first-timer's guide: 7 questions to ask

How I did it: Bought a home without a 20 percent down payment

House Hacks: How buying an investment property worked as my first home

How to set yourself up for success in your first job

Travel for less: Smart (not cheap) ways to spend less on your next trip

Working after retirement: Factors to consider

7 ways for pre-retirees to get ready for retirement

Multiple accounts can make it easier to follow a monthly budget

9 simple ways to save

How Everyday Funding can improve cash flow

How I did it: Learned to budget as a single mom

Payment industry trends that are the future of POS

Modernizing fare payment without leaving any riders behind

Access, flexibility and simplicity: How governments can modernize payments to help their citizens

How to stop living paycheck to paycheck post-pay increase

Do your investments match your financial goals?

5 financial goals for the new year

Money Moments: Tips for selling your home

Parent checklist: Preparing for college

Which is better: Combining bank accounts before marriage — or after?

Don’t underestimate the importance of balancing your checking account

Do you and your fiancé have compatible financial goals?

LGBTQ+ financial planning: 7 reasons why it matters

Reviewing your beneficiaries: A 5-step guide

What government officials should know about real-time payments

Retirement income planning: 4 steps to take

LGBTQ+ retirement planning: What you need to know

Using 529 plans for K-12 tuition

How to retire happy

How to protect your digital assets in your estate plan

Can fantasy football make you a better investor?

Digital Onboarding helps finance firm’s clients build communities

Insource or outsource? 10 considerations

Investment strategies by age

6 tips on trust fund distributions to beneficiaries

How to track your spending patterns

How to manage your money: 6 steps to take

How to discuss money with your family

Good debt vs. bad debt: Know the difference

How to establish your business credit score

4 tips to help you save for retirement in your 20s

4 reasons estate planning is important

Unexpected cost savings may be hiding in your payment strategy

Checklist: 10 questions to ask your home inspector

5 things to avoid that can devalue your home

Webinar: Digitizing receivables to transform B2B rent payments

Checklist: What you’ll need for your first retail pop-up shop

Benefits of billing foreign customers in their own currency

How AR technology is helping advance payment processing at Avera Health

Increase working capital with Commercial Card Optimization

Top tips for card payments optimization

30-day adulting challenge: Financial wellness tasks to complete in a month

5 reasons why couples may have separate bank accounts

7 steps: How couples and single parents can prepare for child care costs

Adulting 101: How to make a budget plan

What you need to know about renting

How and when to ask for a raise

How can I help my student manage money?

How to save for a wedding

How to save money while helping the environment

It's possible: 7 tips for breaking the spending cycle

Money Moments: 3 smart financial strategies when caring for aging parents

Personal finance for teens can empower your child

Tips to overcome three common savings hurdles

Webinar: Uncover the cost: Wedding

Webinar: Uncover the cost: International trip

Your guide to starting a job: Resources to help along the way

It’s time for a fresh start: A new way of thinking

U.S. Bank asks: Do you know your finances?

How mobile point of sale (mPOS) can benefit your side gig

Money Moments: 8 dos and don’ts for saving money in your 30s

Money Moments: How to manage your finances after a divorce

P2P payments make it easier to split the tab

3 awkward situations Zelle can help avoid

What’s in your emergency fund?

Webinar: Uncover the cost: Building a home

10 questions to ask when hiring a contractor

10 ways to increase your home’s curb appeal

Webinar: Uncover the cost: Home renovation

Beyond the mortgage: Other costs for homeowners

Tips for navigating a medical hardship when you’re unable to work

11 essential things to do before baby comes

How to plan and save for adoption and in vitro fertility treatment costs

Closing on a house checklist for buyers

Resources for managing financial matters after an unexpected death

What you need to know as the executor of an estate

When your spouse has passed away: A three-month financial checklist

What documents do you need after a loved one dies?

How to prepare for a natural disaster

Student checklist: Preparing for college

Webinar: Uncover the cost: College diploma

How to save money in college: easy ways to spend less

Checklist: How to gain financial independence from your parents

How I did it: Paid off student loans

Webinar: Bank Notes: College cost comparison

From LLC to S-corp: Choosing a small business entity

7 steps to keep your personal and business finances separate

Dear Money Mentor: How do I begin paying off credit card debt?

Myth vs. truth: What affects your credit score?

How to apply for federal student aid through the FAFSA

Be careful when taking out student loans

Your financial aid guide: What are your options?

Banking connectivity: Helping businesses deliver the easier, faster, more secure customer experience of the future

4 benefits to paying foreign suppliers in their own currency

Military homeownership: Your guide to resources, financing and more

Crypto + Homebuying: Impacts on the real estate market

Integrated receivables management solution supports customer focus at MSC Industrial Supply

Improve government payments with electronic billing platforms

Emerging A/R solutions use artificial intelligence to target efficiency

ABCs of APIs: Drive treasury efficiency with real-time connectivity

Hospitals face cybersecurity risks in surprising new ways

How jumbo loans can help home buyers and your builder business

Higher education strategies for e-payment migration, fighting fraud

Webinar: Mindset Matters: How to practice mindful spending

How real-time inventory visibility can boost retail margins

Webinar: ESG for Corporations: Building an all-weather, long-lasting strategy

How emerging banking solutions enable better decisions

Escheatment resources: Reporting deadlines for all 50 states

Empowering managers with data automation and integration

Common pitfalls to avoid in the equipment financing process

The secret to successful service provider integration

The cyber insurance question: Additional protection beyond prevention

How running a business that aligns with core values is paying off

Meet the Milwaukee businessman behind Funky Fresh Spring Rolls

Questions to ask before buying a car

What you should know about buying a car

How electronic billing platforms improve government payments

How to get started creating your business plan

Talent acquisition 101: Building a small business dream team

Make your business legit

7 tips to help grow your business after launch

How to test new business ideas

Costs to consider when starting a business

How to redefine challenges with business collaboration

How to sell your business without emotions getting in the way

10 tips on how to run a successful family business

The costs of hiring a new employee

How to expand your business: Does a new location make sense?

Rethinking common time management tips

How to apply for a business credit card

How a small business is moving forward during COVID-19

How to accept credit cards online

How to build a content team

3 ways to gain loyalty with your customers

Finance or operating lease? Deciphering the legalese of equipment finance

Time is money: Intelligent Payment Routing saves businesses both

Digital trends poised to reshape hotel payments

Three healthcare payment trends that will continue to matter in 2022

Digital banking for business: How connectivity improves customer experience

Safeguarding the payment experience through contactless

How AI in treasury management is transforming finance

Automate escheatment for accounts payable to save time and money

Understanding and preparing for the new payment experience

White Castle optimizes payment transactions

Collect utility and telecom bill payments faster

Treasury management innovations earn Model Bank awards

ABCs of ARP: Answers to American Rescue Plan questions for counties

The AI journey in finance: How to make it part of your strategy

5 Ways to protect your government agency from payment fraud

Government agency credit card programs and PCI compliance

3 benefits of integrated payments in healthcare

Should you buy a house that’s still under construction?

Webinar: AP automation for commercial real estate

Webinar: CSM corporation re-thinks AP

COVID-19 safety recommendations: Are you ready to reopen?

How to improve digital payments security for your health system

Government billing survey: The digital transformation of the payment experience

Top 3 ways digital payments can transform the patient experience

Webinar: Fraud prevention and mitigation for government agencies

Webinar: CRE technology trends

Webinar: Robotic process automation

Webinar: CRE treasury leader roundtable

Start of disclosure content

Loan approval is subject to credit approval and program guidelines. Not all loan programs are available in all states for all loan amounts. Interest rate and program terms are subject to change without notice. Mortgage, home equity and credit products are offered by U.S. Bank National Association. Deposit products are offered by U.S. Bank National Association. Member FDIC.