When every programme deserves its own cost truth.
For issuers running multiple card programmes — and especially for BIN sponsors managing a portfolio of fintech clients — the inability to accurately allocate scheme fees is more than an accounting inconvenience. It's a direct threat to profitability. Scheme invoices arrive as a single consolidated bill, but your business operates across dozens of programmes, products and clients, each with a completely different cost profile.
Without accurate allocation, you're flying blind
Cross-subsidising some programmes at the expense of others, under-charging clients, and making strategic decisions on fundamentally flawed numbers.
Scheme invoices give no native breakdown
Scheme invoices arrive consolidated — leaving issuers and BIN sponsors to manually apportion costs using methods that are often arbitrary, inconsistent and indefensible.
BIN sponsors under-recover from fintech clients
For BIN sponsors, inaccurate allocation means scheme fees are routinely under-recovered from fintech clients — a problem that compounds with every new programme onboarded and every scheme fee increase.
Blended allocation distorts product P&L
Issuers with multiple product lines — debit, credit, prepaid, commercial — face wildly different cost profiles per programme. Blended allocation systematically distorts P&L performance at the product level.
New programmes are priced on averages, not actuals
Without granular, rules-based allocation, pricing decisions for new programmes are based on averages rather than actuals — almost guaranteeing margin leakage from day one.
Our approach
Structure, transparency and precision — for one of the most persistently unsolved problems in payments finance.
Pinnacle's Cost Allocation Service can be delivered as a one-time engagement to establish the right framework, or as an ongoing managed service that keeps allocation accurate as your business and scheme fee structures evolve. It runs across four distinct workstreams.
Fee Ingestion & Classification
The starting point is getting complete, accurate sight of every fee being charged by the schemes — classified in a way that makes downstream allocation meaningful. Pinnacle ingests your full scheme invoice data and maps every line item into a structured taxonomy that distinguishes fixed from variable costs, issuing from acquiring, and scheme core fees from processing and behavioural charges.
Allocation Model Design & Configuration
No two clients have the same programme structure, commercial agreements or internal reporting requirements — which means allocation rules must be built to reflect your specific reality. Pinnacle designs and configures a customisable allocation model that applies the right methodology to each fee type, ensuring every cost lands in the right place for the right reason.
Validation, Reconciliation & Quality Assurance
An allocation model is only as good as its outputs — and outputs need to be verifiable. Pinnacle builds reconciliation checks into the model to ensure that allocated costs always tie back to actual scheme invoices, and that movements in fees from month to month are explainable at the programme level.
Reporting, Integration & Ongoing Management
The final workstream turns the allocation model into something the business can actually use — feeding internal P&L reporting, informing client billing, or providing the cost transparency needed for confident pricing decisions. For clients who choose the ongoing managed service, Pinnacle operates the model on a monthly basis as scheme invoices are received.
From cost fog to cost clarity
For most issuers, acquirers and BIN sponsors, accurate scheme fee allocation has always been the problem they know they have but never quite get around to solving. Pinnacle's Cost Allocation Service fixes that — and the commercial impact is immediate, measurable and lasting. Clients don't just get better numbers; they get a fundamentally different ability to run, price and grow their business with confidence.
Dramatically improved cost recovery
BIN sponsors and programme managers implementing Pinnacle's allocation model consistently see fee recovery rates from fintech clients jump materially — in some cases from as low as 67% to above 98%, representing millions of dollars in previously lost revenue recovered on an ongoing annual basis.
P&L performance you can actually trust
With costs accurately allocated to programme, product and client level, finance and commercial teams finally have a version of profitability they can make decisions from — eliminating the cross-subsidisation and distorted margins that come with blended or approximate allocation approaches.
A scalable foundation for business growth
As new programmes are onboarded and scheme fees continue to evolve, the allocation model scales with the business — ensuring every new client is priced correctly from day one and that fee increases are passed through accurately rather than absorbed silently into margin.
Reduced operational burden and audit risk
By replacing manual, spreadsheet-based allocation with a structured, rules-based model backed by a full audit trail, clients significantly reduce the internal effort required each month while simultaneously strengthening their position in any client dispute or regulatory review.
Ready to take control of your scheme fees, announcements & interchange?
Our team of subject-matter experts is here to help you. Whether you're an issuer or an acquirer, an ISO or a PayFac, let us show you how easily and quickly SchemeSense can help you improve portfolio profitability. Book a demo today, or contact us to discuss our advisory and consultancy services.
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