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Walter Lironi, Head of Consulting & Analytics, Visa CEMEA

September 2023


4 - 5 Minutes

How Portfolio Profitability Optimization Takes Shape Today and Tomorrow

In a competitive world, portfolio profitability optimization can help financial institutions unlock the full potential of their payments businesses. Here Walter Lironi, Head of Visa Consulting & Analytics (VCA) for the CEMEA region, outlines how active portfolio management can boost profitability, key trends across the region, and what VCA experience reveals about best practices.

Unlocking the Full Potential of Payments Businesses

Picture a scenario where a customer opens an account within a minute; then is encouraged to activate and spend on their new card by gamified challenges and rewarded with tailored incentives; while any signs they could be disengaging from the relationship are flagged early, allowing their bank to personalize its communication in response. They could also keep receiving suggestions through their preferred channel, sometimes even in real-time, that are tailored to specific needs and commerce preferences. In contrast, imagine the cardholder is slow to become active on the card, disengaged over the rest of the relationship and, finally, becoming dormant sooner than anticipated.

The difference between these two scenarios? Active portfolio management – essentially, the capability to deliver at scale and personalizing touchpoints through the customer lifecycle using sophisticated data and optimized engagement channels to enhance overall profitability – can dramatically enhance the performance of a bank’s payments business and holds the key to success throughout the entire customer lifecycle – from acquisition to activation, to engagement and, ultimately, retention.

Activation and Engagement - How CEMEA’s Banks Tackle Optimization

By looking at what is at stake, it becomes evident why active portfolio management matters. Acquiring a customer can be expensive, so a targeted, efficient process is needed to reduce the cost. Next, the earlier a customer becomes active on their new card, the faster banks can reach their breakeven point - and the more likely it is that the customer places that card top of their wallet.

Across Central and Eastern Europe, Middle East and Africa (CEMEA), card activation varies between 25-60%, depending on the market – but even in markets with relatively high activation rates, the leading banks achieve card activation that is three times the market median. For example, in the Kingdom of Saudi Arabia (KSA) a bank with the market median in terms of activation rates can drive ~$10M in revenues annually by improving card activation to 80%.1

Furthermore, the more engaged institutions remain with their customers, the more they can encourage spending and build retention, while identifying cross-selling opportunities. Those banks which do not actively manage retention can see nearly one in three cards becoming dormant each quarter – which, at worst, could mean 100% of a bank’s portfolio falls dormant within a year.2 Even in the UAE, which has the lowest dormancy rates and lowest variability around them between banks, a five-percentage point improvement in dormancy could unlock $2M of revenue per institution.3

Best Practices at Work – Sophisticated Data Holds the Key to Success

Unlocking this potential through portfolio management demands a multi-layered strategy. At the start of a customer relationship, it requires hyper-personalized acquisition efforts – for example, identifying customers as eco-conscious consumers or sporting enthusiasts, allowing them to choose the benefits that matter most. This can be paired to powerful effect with a mature digital onboarding process, with easy-to-use features, such as verification by video call. Digital banks are enjoying strong momentum in terms of acquiring customers, with a recent survey across the Gulf Cooperation Council (GCC) finding that one in four customers switched banks, of whom half chose a bank with better digital maturity.4

After acquisition, the first 90 days are critical in shaping cardholder behavior, yet even globally, many issuers allocate only about a fifth of their marketing budgets to this period. Early Month on Book (EMOB) activation using interactive and personalized tactics, such as rewards for unlocking gamified challenges especially on digital channels, is key. In terms of managing the longer relationship with the customer, banks need to engage the customer based on where they find value – via cashback promotions on their favourite categories, for example. Personalization is once again a way for banks to best serve their customers while boosting profitability, by extending offers and rewards at the right time and in the right place. As for retention, tracking warning signs can ensure potential attrition is detected early.

A Multichannel Approach - How Visa Supports Portfolio Optimization

Here, Visa offers solutions across all stages of the customer life cycle, supported by Visa data science experts, proprietary market and customer insights, and advanced modelling techniques. Visa can also lead execution and performance measurement, in terms of the relevant models and recommendations.

To walk through the customer lifecycle, beginning with acquisition, Visa Consulting & Analytics (VCA) can help banks benefit from rapid fully digital onboarding, hyper-personalized propositions enabled by end-to-end (E2E) digital experience with superior UI/UX, CVP profitability simulation. Next, in terms of activation, Visa provides analyses to identify early engagement drivers; and supports a multichannel approach to activation, including gamified customer interactions. As for engagement throughout the customer relationship, Visa can assist clients in driving spend via tailored products, such as contextual geolocation, and enable specific use cases. Lastly, Visa offers targeted tools to tackle attrition, including its proprietary model to identify signs of a customer’s coming dormancy - that a standalone portfolio may not be able to capture on its own - and can help banks personalize campaigns in response.

At the core of all these tools is the sophisticated use of data, which is foundational to optimizing profitability. This means compiling information coming from different departments and sources to offer one coherent view of customers, as opposed to multiple versions. To achieve this requires a scalable data infrastructure covering multiple geographies and divisions, and deep analytical capabilities, including machine learning and artificial intelligence, to carry out powerful modelling. Again, Visa can support clients, by accelerating their data science capabilities through 360-degree diagnostics of their data tech infrastructure and strategy.

By sharing insights and best practices on portfolio management, Visa is ready support clients to unlock the full potential of their payments businesses, while driving profitability and reducing losses throughout the entire customer lifecycle - from acquisition to activation, to engagement and, ultimately, retention. Optimizing portfolio management will, by necessity, remain a continuous priority – but the upside is that both consumer needs and profitability can be tackled via one coherent strategy, to benefit all.

If you’d like an in-depth conversation on portfolio optimization and the opportunities for your business, please get in touch with your Visa Account Executive, or email

Capability Building - Portfolio Management by Visa University

For over 15 years, Visa’s and leading industry experts have been providing payments professionals with the tools and trainings they need to get the results they seek – through curriculum offerings and certified programs offered by Visa University.

This includes a comprehensive suite of courses on portfolio management, which cover pertinent strategic areas such as card profitability, marketing, risk management and data analysis. These courses take an in-depth look at a wide range of topics including issuing and acquiring fundamentals, strategies for driving credit and debit usage, risk-based pricing and managing the customer experience.

As part of this, Visa University offers enrolment in Payments Management Labs - certified training programs, hosted both virtually as 10-week certificate programs, as well as in-person in different locations around the world featuring expert-led discussions, networking, and hands-on learning. Separately, Visa University also hosts a Payments Management Challenge – an eight-week virtual competition to determine which team can build the most successful payments portfolio over a five-year period in a simulated marketplace. These immersive programs help participants stay ahead in today’s market.

Learn more about all of Visa University’s offerings by visiting or VisaOnline, following Visa University on LinkedIn and subscribing to weekly newsletter.

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All brand names, logos and/or trademarks are the property of their respective owners, are used for identification purposes only, and do not necessarily imply product endorsement or affiliation with Visa.

1 Incremental revenue potential for a bank with 1M card, source: Visa Consulting & Analytics data
2 Source: Visa Consulting & Analytics data
3 Source: Visa Consulting & Analytics data
4 Source: VCA data, survey

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