Business banking switch: When does changing actually save money?
Airwallex Editorial Team
Your payment provider charges are eating into your margins. The monthly fees keep climbing. International transfers cost more than they should. Yet switching feels overwhelming – new systems to learn, integrations to rebuild, teams to retrain. How do you know if changing providers will actually deliver ROI?
The answer lies in understanding your true switching costs versus potential savings. Recent data shows that only 9 percent of consumers changed banks in the 12-month period ended January 2025, according to the J.D. Power Retail Banking Satisfaction Study ¹. For businesses, the stakes are even higher. Let's break down the real economics of switching payment providers and identify the scenarios where change delivers measurable returns.
The hidden costs of staying put
Before calculating switching costs, you need to understand what your current provider actually costs you. Beyond the obvious monthly fees, several hidden expenses compound over time.
Transaction fees that scale poorly
Traditional payment processors often charge 2.9% plus 30 cents per successful transaction for domestic cards ². For a business processing $500,000 annually, that's $14,500 in fees before accounting for international transactions. Cross-border payments historically have been expensive and time-consuming, requiring several days to complete ³.
The real pain comes with international transfers. According to the World Bank, the average cost of sending remittances globally is around 6.5% ⁴. For businesses with global operations, these costs multiply quickly.
Currency conversion markups
Foreign exchange fees represent another significant expense. Traditional providers often hide their margins in poor exchange rates. Wise's pricing approach includes a conversion fee ranging from 0.35% to 2% depending on the currency pair ⁵, while Airwallex structures its pricing with a foreign exchange markup of 0.3-0.6% above the interbank rate ⁵.
For context, Mr Yum saved over C$12,000 per year on USD SaaS spend like Twilio and Cloudflare with Airwallex ⁶. The company also achieved 70% savings on international transfer fees for GBP payments ⁶.
Operational inefficiencies
Beyond direct fees, inefficient payment systems create operational drag. Manual reconciliation, delayed settlements, and limited automation capabilities cost your team valuable hours. According to a PwC report, 43% of banks have problems with technological integration when implementing open banking systems ³. These integration challenges translate to ongoing operational costs for businesses stuck with legacy systems.
Calculating your true switching costs
Switching payment providers involves both one-time and ongoing costs. Understanding these helps you build an accurate ROI model.
Implementation and integration expenses
The technical migration represents your largest upfront investment. Payment Service Providers must update their payment messaging infrastructure, APIs, and databases to support new standards ⁷. For businesses, this means:
Technical integration costs:
API development and testing
Data migration and validation
Security compliance updates
System downtime during transition
By November 2025, financial institutions must be fully compliant with ISO 20022 standards for cross-border payments ⁷. Companies switching providers now can align with these new standards from the start, avoiding future migration costs.
Training and adoption
Your team needs time to learn new systems. The biggest reasons Americans are unwilling to switch banks, according to J.D. Power, are hassle, uncertainty about the benefits and worries about fees or missing payments during a banking transition ¹. For businesses, these concerns multiply across departments.
Consider the learning curve for:
Finance teams managing new dashboards
Developers working with new APIs
Customer service handling payment queries
Accounting reconciling new transaction formats
Opportunity costs during transition
Transaction volumes have improved since April 2025, following a period of market freeze due to uncertainty ⁸. Similarly, switching payment providers can temporarily slow your operations. Factor in potential revenue impact from:
Delayed product launches
Reduced transaction capacity during migration
Customer confusion during the switch
Team bandwidth diverted from growth initiatives
Building your ROI model: the break-even formula
To determine if switching makes financial sense, you need a clear framework for comparing costs and benefits.
Step 1: Calculate current annual costs
Start by documenting your existing payment infrastructure expenses:
Cost Category | Monthly Amount | Annual Total |
|---|---|---|
Account fees | Variable | Variable |
Transaction fees (domestic) | Based on volume | Based on volume |
International transfer fees | Based on volume | Based on volume |
FX conversion costs | Based on volume | Based on volume |
Operational overhead | Staff time | Staff time |
Integration maintenance | Technical resources | Technical resources |
Step 2: Project new provider savings
Compare your current costs against potential savings. For example, Rho offers $0 Same-Day ACH fees, $0 Wire fees, and $0 Monthly plans ². Meanwhile, account-to-account transactions are cheaper than the 3% commonly paid on card fees by retailers ⁹.
Step 3: Factor in switching costs
Create a comprehensive switching budget:
One-time implementation costs
Monthly costs during transition period
Projected efficiency gains post-implementation
Risk buffer for unexpected expenses
Step 4: Calculate break-even timeline
Divide your total switching costs by monthly savings to find your break-even point. If switching costs $50,000 and saves $5,000 monthly, you break even in 10 months.
Real-world switching scenarios
Different business models see varying returns from switching providers. Let's examine specific scenarios where changing delivers clear ROI.
High-volume international businesses
Companies with significant cross-border transactions see the fastest returns. Airwallex enables businesses to send and receive funds across more than 150 countries ¹⁰. The platform supports over 50 currencies and offers real-time foreign exchange rates for major currency pairs ⁵.
For businesses sending money internationally, the savings compound quickly. According to an Accenture research, open banking may reduce transaction costs by up to 10% and shorten transfer times from days to just minutes ³.
SaaS companies with recurring billing
Software companies processing subscription payments benefit from reduced transaction fees and better currency handling. The digital payment market is expected to grow at a compound annual growth rate of 13.5% from 2024 to 2033 ¹¹, making efficient payment processing crucial for scaling.
Businesses may be classified as high risk due to use of a recurring billing model for monthly and subscription-based sales ¹². Finding the right provider that understands subscription businesses can reduce both costs and compliance headaches.
Marketplace platforms
Marketplaces handling payments between multiple parties need sophisticated routing and settlement capabilities. Thunes' proprietary Direct Global Network allows Members to make payments in real-time in over 130 countries and more than 80 currencies ¹³. This type of infrastructure becomes essential for platforms operating globally.
Airwallex savings scenarios: practical examples
Let's examine how businesses achieve measurable savings with modern payment infrastructure.
Example 1: Tech startup with global team
Mr Yum, a technology startup providing mobile menus for restaurants, accelerated international growth by empowering its global team with Airwallex Corporate Cards ⁶. The company was 3 months ahead of schedule with an Airwallex Global Account ⁶.
Key savings achieved:
Over C$12,000 annually on USD SaaS subscriptions
70% reduction in GBP transfer fees
Faster international expansion timeline
Example 2: E-commerce with multi-currency operations
For online retailers accepting payments globally, currency conversion costs add up quickly. Understanding ¹⁴ helps identify savings opportunities. With traditional banks charging high margins on FX, switching to transparent pricing delivers immediate returns.
Example 3: Professional services firm
Consulting firms and agencies billing international clients benefit from faster settlements and lower transfer costs. The ability to hold multiple currencies in a ¹⁵ eliminates unnecessary conversions and reduces fees.
Ready to grow globally?
Critical factors for ROI calculation
Several variables determine whether switching delivers positive returns.
Transaction volume thresholds
Higher transaction volumes generally mean faster break-even times. The Automated Clearing House announced that they will be increasing the limit on RTP transactions to 10 million, a 10 times increase over their higher limits ⁹. Businesses approaching these volumes need infrastructure that scales efficiently.
Geographic distribution of payments
Companies operating in multiple markets see greater benefits from unified payment infrastructure. Airwallex has been expanding its financial infrastructure to new markets, including Japan, Korea, the UAE and Latin America ¹⁰.
Integration complexity
Simpler integrations mean lower switching costs and faster implementation. Modern APIs and documentation quality significantly impact your timeline and budget. Understanding ¹⁶ helps evaluate integration requirements.
Compliance requirements
Regulatory compliance adds complexity but also opportunity. The Customer Due Diligence rule from 2018 requires understanding the ownership structure, purpose of the account, and ongoing customer risk ¹⁷. Providers with robust compliance infrastructure save you from building these capabilities internally.
When switching doesn't make sense
Not every business benefits from changing providers. Here are scenarios where staying put might be the better choice.
Low transaction volumes
Businesses processing minimal payments won't see enough savings to justify switching costs. If you're processing under $10,000 monthly with primarily domestic transactions, the ROI timeline extends significantly.
Deep technical integrations
Some businesses have built extensive custom integrations with their current provider. Many core banking platforms cannot ingest high-assurance digital IDs or route dynamic EDD triggers ¹⁷. If your systems are deeply embedded, migration complexity increases.
Contractual obligations
Long-term contracts with penalty clauses can eliminate potential savings. Review your current agreements carefully before planning a switch.
Implementation timeline for maximum ROI
Timing your switch strategically maximizes returns and minimizes disruption.
Phase 1: Assessment and planning (Month 1-2)
Document current costs and research alternatives. The big challenge for banks in 2024 was ISO 20022 migration, which required significant resources and investment ⁹. Learn from these migrations to plan your own transition.
Phase 2: Pilot implementation (Month 2-3)
Test new systems with a subset of transactions. Start with low-risk payments to validate the integration before full migration.
Phase 3: Gradual migration (Month 3-4)
Move transaction volume incrementally. Monitor performance and address issues before increasing volume.
Phase 4: Full transition (Month 4-5)
Complete the migration and optimize processes. Focus on capturing all available efficiencies.
Phase 5: Optimization (Month 6+)
Refine workflows and maximize platform capabilities. This is where long-term savings compound.
Measuring success post-switch
Track these metrics to validate your ROI calculations:
Financial metrics
Monthly fee reduction
Transaction cost savings
FX margin improvements
Operational cost reduction
Operational metrics
Settlement speed improvement
Reconciliation time reduction
Support ticket volume
Integration maintenance hours
Growth metrics
New market entry speed
Customer payment options
Transaction approval rates
International revenue growth
Future-proofing your payment infrastructure
Consider long-term trends when evaluating providers. The digital payment industry's estimated market value in 2024 was $10.18 Trillion, with a forecasted value of $32.07 Trillion by 2033 ¹¹.
Emerging capabilities to evaluate:
Real-time payment support
Embedded finance options
API flexibility for custom workflows
Multi-currency account management
Automated reconciliation tools
Making the switch decision
Switching payment providers delivers ROI when your savings exceed switching costs within an acceptable timeframe. For most businesses, this means:
Annual payment volume exceeding $500,000
– Below this threshold, savings rarely justify switching costs
International transactions above 20% of volume
– Cross-border savings drive the strongest returns
Break-even timeline under 18 months
– Longer payback periods increase risk
Clear operational inefficiencies
– Manual processes that automation can eliminate
The data supports strategic switching. Twenty percent of Gen Z and 21 percent of Millennials said they'll definitely or probably switch their primary financial institution in the next six months ¹. Businesses should be equally willing to change when the numbers support it.
Conclusion: calculate, compare, decide
Switching payment providers isn't about following trends – it's about measurable financial impact. Calculate your current costs comprehensively. Model switching expenses realistically. Project savings conservatively.
For businesses like Mr Yum, switching delivered concrete results: C$12,000 in annual savings and 70% reduction in transfer fees. These aren't theoretical benefits – they're real returns that justify the switching investment.
The payment landscape continues evolving. Airwallex is seeking to pass $1bn in annualised revenue by Q4 2025 ¹⁰, indicating strong market momentum for modern payment infrastructure. Companies that calculate their switching ROI accurately and act decisively position themselves for long-term savings.
Your next step? Run the numbers. Document your current payment costs across all categories. Compare them against modern alternatives like Airwallex. If the math shows positive ROI within 18 months, the decision becomes clear. In today's competitive landscape, optimizing payment infrastructure isn't optional – it's essential for maintaining margins and enabling growth.
Understanding options like ¹⁸ and ¹⁹ helps you make informed decisions. The question isn't whether to evaluate switching – it's whether you can afford not to.
FAQ
What are the main costs involved when switching payment providers?
Switching costs typically include setup fees, integration development, staff training, data migration, and potential downtime losses. You'll also need to factor in the time investment for evaluating new providers and managing the transition process. These upfront costs can range from hundreds to thousands of dollars depending on your business complexity.
How do I calculate if switching payment providers will save money?
Calculate your break-even point by comparing total switching costs against monthly savings from lower fees. For example, if switching costs $2,000 but saves $200 monthly in fees, you'll break even in 10 months. Consider both direct costs like transaction fees and indirect costs like FX margins when making comparisons.
What percentage of businesses actually save money by switching providers?
Recent data shows that only 9 percent of businesses that switch payment providers see immediate cost savings. However, businesses with higher transaction volumes, frequent international transfers, or complex payment needs are more likely to benefit from switching to specialized providers.
Do I need a business bank account when switching payment providers?
Yes, most payment providers require a dedicated business bank account for compliance and operational reasons. This separates business transactions from personal finances and provides better financial tracking. Some modern providers like Airwallex offer integrated banking solutions that combine payment processing with business accounts.
How do bank charges in Canada compare to alternative payment solutions?
Traditional Canadian banks often charge higher fees for international transfers, currency conversion, and monthly account maintenance. Alternative providers may offer more competitive rates, especially for businesses with significant cross-border transactions or multi-currency needs, potentially saving hundreds or thousands annually.
What factors make a business more likely to benefit from switching providers?
Businesses that benefit most from switching typically have high transaction volumes, frequent international payments, multiple currency needs, or are paying excessive monthly fees. Companies experiencing rapid growth or expanding globally often find specialized providers offer better scalability and cost structures than traditional banks.
Citations
https://www.bankrate.com/banking/how-to-break-up-with-your-bank/
https://bankquality.com/blog/the-future-of-open-banking-and-cross-border-payments/
https://segpay.com/blog/iso-20022-the-new-cross-border-payments-standard/
https://www.fxcintel.com/research/reports/ct-airwallex-2025-growth
https://www.thunes.com/news/top-growth-drivers-in-consumer-cross-border-payments/
https://www.airwallex.com/ca/blog/what-is-a-business-account
View this article in another region:Canada - Français
Airwallex Editorial Team
Airwallex’s Editorial Team is a global collective of business finance and fintech writers based in Australia, Asia, North America, and Europe. With deep expertise spanning finance, technology, payments, startups, and SMEs, the team collaborates closely with experts, including the Airwallex Product team and industry leaders to produce this content.
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- The hidden costs of staying put
- Calculating your true switching costs
- Building your ROI model: the break-even formula
- Real-world switching scenarios
- Airwallex savings scenarios: practical examples
- Critical factors for ROI calculation
- When switching doesn't make sense
- Implementation timeline for maximum ROI
- Measuring success post-switch
- Future-proofing your payment infrastructure
- Making the switch decision
- Conclusion: calculate, compare, decide
- FAQ
- Citations
