The residual report is a powerful tool for partners to analyze their payment processing performance, track revenue, and identify growth opportunities. This guide walks you through the process of reading and understanding your residual report, so you can make the most out of its insights.

Overview

Begin by understanding the structure of your residual report. It typically includes:

Transaction Data: A detailed list of successful transactions.

Financial Details: Key metrics, fees, and profitability insights.

Revenue Allocation: Breakdown of revenue shared between you and Stax.

Column Definitions: A table explaining what each column represents.

Take a moment to familiarize yourself with the column definitions below. These will help you interpret the data:

Column Name	Description
activity_period	Date the payment was processed
merchant_name	The name of the merchant (associated with the transaction).
mid	The Merchant ID, a unique identifier for each merchant.
omid	Also known as the PMID, is an ID unique to the Stax platform.
partner	Name of the partner associated with the merchant.
transaction_id	Unique identifier for each transaction.
pricing_type	Pricing model for the sub-merchant’s go-to-market (GTM) fees, this could be Flat Rate or Interchange Plus.
payment_method	Payment type used for the transaction. Could be ACH (bank), VS (Visa), MC (Mastercard), DS (Discover), AX (American Express), PD (Pin Debit).
interchange_descriptor	Interchange descriptor for the card type the cardholder used for payment, directly correlated to Interchange and Assessment fees (e.g., VS Business Tier 5 Level 2).
settled_amount	Amount the cardholder was charged for goods or services.
gtm_rate	GTM rate sub-merchants are charged for processing payments (e.g., 2.89%).
flat_rate_fee	Total amount that was calculated based on the dollar amount processed: `settled_amount x gtm_rate`.
txn_count	Number of transactions relevant in that specific line item (This should always be 1).
per_transaction_rate	Cents per transaction rate charged to the sub-merchant for a single payment, usually in addition to the flat rate fee.
per_transaction_fee	Fee amount per transaction. The calculation for the per-transaction fee portion of a GTM pricing plan: `txn_count x per_transaction_rate`.
total_gtm_fee	The total fee charged for transaction(s) is based on the GTM pricing plan and settled amount. Calculation: `flat_rate_fee + per_transaction_fee`.
assessment_rate	Network fee, in percentage form, from card brands like Visa, Discover, American Express, and Mastercard.
total_assessments	Total dollar amount charged for assessments.
interchange_rate	Percentage-based fee determined by card brands according to card type and payment method.
total_interchange	Total dollar amount charged for interchange fees.
total_interchange_and_assessments	Standardized card brand fees also known as Interchange, Dues, and Assessments (IDA). Calculation: `total_interchange + total_assessments`.
net_revenue	Total profitability of transaction after Interchange and Assessments are removed. Calculation: `total_gtm_fee - total_interchange_and_assessments`.
bps_buy_rate	Baseline buy rate, in basis points, indicated in the contract signed during the sales process.
additl_buy_rate	Any additional buy rate, in basis points, found in Platform Services Agreement / Schedule A.
total_buy_rate	Total buy rate, in basis points, paid to Stax. Calculation: `bps_buy_rate + additl_buy_rate`.
cents_per_trans_buy_rate	Cents per transaction buy rate indicated in your Platform Services Agreement / Schedule A with Stax.
total_bps_buy_rate	Dollar calculation of the basis points portion of the Partner’s buy rate with Stax. Calculation: `settled_amount x total_buy_rate`.
total_cents_per_trans_buy_rate	Total cents per transaction buy rate indicated in your Platform Services Agreement / Schedule A with Stax.
total_buy_rates	Total dollar calculation of buy rate paid to Stax. Calculation: `(settled_amount x total_buy_rate) + (txn_count x total_cents_per_trans_buy_rate)`.
total_residual	Residual amount before revenue share owed to Stax is calculated. Calculation: `net_revenue - total_buy_rates`.
rev_share	Percentage of revenue from residuals shared with Stax.
total_rev_share	Revenue share in dollar form paid to Stax. Calculation: `total_residual x (1 - rev_share)`.
adjusted_residual	Partner’s final payout on the transaction(s). Calculation: `total_residual x rev_share`.
custom_fee	Matches Total GTM Fees charged to the sub-merchant when custom fee functionality is used.
custom_fee_msg	Messaging indicating what the custom fee was for (may not apply to every partner or transaction).
surcharge	Dollar amount of surcharge assessed to the cardholder. Should be subtracted from Settled Amount if validating residuals.
surcharge_rate	Surcharge GTM rate assessed to the cardholder if surcharging pricing is applied (may not apply to every partner or transaction).
ach_fee_cap	Dollar amount determined by the partner specifying the maximum ACH fee.

Key Sections of the Report

Understand the Transaction Data

Begin with the activity_period to identify the date range for the transactions.
Look at the merchant_name and mid columns to pinpoint which merchants contributed to the transactions.

Break Down Financial Details

Use the settled_amount to see the total revenue processed.
Review gtm_rate and flat_rate_fee to understand the fees charged to the sub-merchants.
Cross-check total_interchange and total_assessments to evaluate the costs from card brands.

Leverage Insights for Growth

Identify Inactive Merchants

Search for merchants with zero or minimal transaction counts.
Engage with these merchants to reactivate their accounts by offering training, support, or promotional incentives.

Optimize Interchange Fees

Analyze the interchange_descriptor column for patterns. Merchants may benefit from strategies like Level 2/3 processing to lower costs.

Segment Merchant Performance

Use metrics such as adjusted_residual and settled_amount to classify merchants by profitability and identify high-potential accounts.

Key Metrics Partners Should Focus On

Partners often default to looking only at their adjusted_residual, but there’s much more value in the report:

Take Rate

Reflects how much revenue is retained after fees.

(`net_revenue` / `settled_amount`) x 100 = Take Rate 💰

Measure Profitability: The Take Rate shows how much revenue you retain after deducting all fees. It's a direct indicator of your profitability.

Identify Cost Inefficiencies: A low Take Rate can indicate high fees relative to revenue, signaling areas where cost optimization is needed.

Compare Performance: Use the Take Rate to benchmark your performance across different merchants or reporting periods.

Informed Pricing Decisions: Understanding your Take Rate can help you make better decisions about pricing strategies to maintain a healthy profit margin.

Merchant Segmentation

Identify merchants driving most of the revenue and those needing activation.

Use metrics such as settled_amount and adjusted_residual to identify merchants driving the most revenue and those with low or no transaction activity. For example:

High Performer Calculation: Identify merchants with the highest settled_amount and adjusted_residual to understand which accounts are most profitable.

Example: A merchant processed $50,000 (settled_amount) and generated $5,000 (adjusted_residual), meaning they contributed 10% profitability.

Inactive Merchant Calculation: Spot merchants with very low settled amounts (e.g., <$1,000).

Example: A merchant with only $500 in settled_amount is likely inactive or underperforming. Focus on re-engaging these merchants through tailored support or incentives.

This approach allows you to focus on high-performing merchants for growth opportunities and target inactive ones with re-engagement strategies like offering incentives or tailored support. Prioritizing efforts this way helps maximize revenue growth.

Revenue Forecasting

To forecast revenue, partners can analyze historical data trends for net_revenue and adjusted_residual over previous months. By identifying patterns and growth rates, partners can estimate future revenue.

For example:

Calculate the average monthly growth rate of net_revenue and project this rate forward.
Use past adjusted_residual figures to identify seasonality or periods of high activity and adjust forecasts accordingly.