Canadian card issuer identifies C$3.0M in recurring annual network fee savings
A 4-6 week review of this C$10-20B Canadian issuer's network fees found C$3.0M a year in recurring savings, even though the bank already reviewed its invoices carefully. Two-thirds came from opting out of services it didn't need.
| Client type | Card issuer |
|---|---|
| Size | C$10-20B annual card purchase volume |
| Market | Canada |
| Networks reviewed | Visa and Mastercard |
| Analysis time | 4-6 weeks |
| Line items flagged | 100 |
| Potential savings | C$3.0M a year, recurring |
| Savings relative to volume | 1-2 bps |
What did the review find?
The bank had a robust process to review its invoices. The savings were in services it was paying for but didn't need, and in processes that weren't set up efficiently.
71% of the opportunity was rated medium or high likelihood of realization.
Where did the savings come from?
Opting out of unneeded services made up two-thirds of the total. Process changes accounted for most of the rest, with a small amount in charges worth contesting.
| Category | Amount | Share |
|---|---|---|
| Opt-out of unnecessary services | C$2.0M | 67% |
| Best practice alignment | C$0.9M | 29% |
| Fees to challenge | C$0.1M | 4% |
| Total | C$3.0M | 100% |
How long did it take, and what data was needed?
The analysis took 4-6 weeks and used 12 months of Visa and Mastercard invoices and volume data. No system integration was required.
What does this mean for other Canadian issuers?
Reviewing invoices isn't the same as optimizing fees. Network invoices run to hundreds or thousands of lines, and the remaining opportunity usually sits in services and set-up choices that nobody has revisited since they were switched on.
These are often the easiest savings to act on, because opting out rarely needs a system change.
Questions and answers
How much can a Canadian card issuer save on Visa and Mastercard network fees?
In this review, C$3.0M a year in recurring savings, or 1-2 bps of annual card purchase volume. CardTraq has completed network fee reviews for clients in more than 40 countries, including several global clients operating in most countries, and potential savings levels are consistent across all of them.
Where do network fee savings come from when invoices are already reviewed?
Mostly from opting out of services that aren't needed. Here that was two-thirds of the total, with most of the rest from process changes.
How much of the identified savings is likely to be realized?
In this review, 71% of the opportunity was rated medium or high likelihood of realization. CardTraq clients typically realize 40-80% of what's identified, depending on how they prioritize implementation and which optional services they decide are worth keeping.
Recurring annual savings from a 12-month review of Visa and Mastercard billing.
Most programs we review are paying network fees they don't need to. A review takes 4-6 weeks and needs only your network invoices and volume reports.
Get a network fee review