I have worked in the fitness industry for 6 years now. This is a...

I have worked in the fitness industry for 6 years now. This is a very good move by Viva. These debit companies take a fixed amount, usually $1, for each transaction on a bank account, or 2% for a debit/credit card. They also charge a dishonor fee if the member fails to make a payment, usually $10, which goes to the direct debit company, not the fitness company.

If they internalize these expenses, a rough estimate of of 2% on their $83 million revenue for last year gives a saving of around $1.5 million. Also, it seems like they'll implement this for their franchisees as well, so its another stream of revenue outside of their franchisee fees, this would be too hard to predict accurately though. At their $200 million estimate, I'm assuming this is $83 million plus $120 million of their franchisee turnover? So they'd be making roughly a further $2.4 million, combined with a saving of $1.5 million = $3.9 million total per year. I don't know how expensive it will be to create this Viva Pay, but even it costs $20 million, 20% ROI makes it worth it, with rising revenues.

HOWEVER, I doubt they will charge their franchisees the same rate as the existing arrangements, so only Viva really knows.