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BUSINESS CASE: SOUTH EAST ASIA

Tracked value of 12.12 USD recurrent every year per active credit card

REGION: SOUTH EAST ASIA

 

CLIENT: LEADING BANK IN ITS MARKET

 

MODULE: REVENUE ENHANCEMENT

 

SCOPE: CREDIT CARDS

ACTIVE CREDIT CARD PORTFOLIO: > 900 K

PROJECT EXECUTION: 14 WEEKS

Image by Mike Enerio

+ 12.12 USD

per year

 

tracked per active credit card

FACTSHEET RESULTS
 

  • 37 strategies were presented for the bank’s consideration. 

  • The tracked value is at 12.12 USD recurrent every year per active Credit Card. 

  • First implementation was 6 months after the end of the project.

  • Implementation ratio to presented value is at 35%.

  • 61% of the value implemented required a low complexity development.

ENGAGEMENT SUMMARY
 

PROJECT EXECUTION

The project was executed during a period of 14 weeks on the client’s premises. The client, the leading bank in its south east Asian market, was interested in measures that would increase the profitability of its credit card business but will have very little or no impact in its information technology systems. 

Their core banking system was considerably outdated and provided them with no flexibility. In addition, the bank was encountering aggressive competition in the market and did not wanted to conduct changes that could affect customer satisfaction. 

In this context, the four-man team from UPITE was able to present 37 strategies aimed at increasing the banks billings minimizing. Of these strategies 15 were approved and prioritized for implementation. The development of the initial strategies was initialized three months after implementation and were in place before the 6-month mark after project end.

Recurrent annual value presented vs. accepted per active credit card (in USD)

20 USD

15 USD

10 USD

5 USD

0 USD

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14.74

9.02

Presented

Accepted

Considering the limitations imposed by their IT infrastructure and their competitive position, the bank aimed for 5.00 US per year of additional income per active card to be generated by the project. At project end the estimated impact of the accepted strategies was 9.02 USD, exceeding the client’s expectations by 80%.

IMPLEMENTATION PROCESS

Of the initial approved strategies, 10 were implemented within the first year after project execution and 5 are pending implementation, awaiting a new banking core system scheduled to be deployed.

Original impact estimations of the implemented strategies proved to be conservative, as the tracked impact is 60 % above their original estimation.

Implementation complexity by value

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31%

61%

8%

0%

Parameter

Low

Medium

High

As you can see above 31% of the value implemented was parametric. All parametric strategies were implemented within 6 months after their presentation.

Due to their technological infrastructure limitations, no recommendations that would have required extensive development were presented to the client. 

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Value distribution by income lever of accepted strategies

7.8%

92.2%

Fees

Interest

RESULTS OBTAINED

UPITE was able to deliver strategies that would consistently increase the profitability of the bank’s portfolio, despite severe IT restrictions and a tough competitive environment:

  • 12.12 USD per active Credit Card

Additional impact per card is expected to be achieved once additional IT capabilities are acquired by the client and allow the implementation of 5 additional strategies. 

The client was extremely pleased with the results of the project and since this initial project UPITE Consulting has worked in two additional engagements for this client.

200 USD

150 USD

100 USD

50 USD

0 USD

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+9.71%

124.89 USD per card

137.01 USD per card

Segment income

Before UPITE

After UPITE

UPITEs initiatives generate an additional 9.71% of gross income for the credit card segment, effect that multiplies at a net income level. 

 

The excellent disposition of the client and the direct involvement of the banks top management was a significant factor on the success of this project.