What Is The Full Form Of CAC In Banking?

CAC full form in banking is the Customer acquisition cost. The sum of money a business, bank, or other financial organization spends to acquire a new client is the customer acquisition cost (CAC). Anything pertaining to sales, marketing, or any other expense or cost might be included in this.

The formula for calculating customer acquisition cost (CAC) is –

Total amount of money spent / Total number of new customers acquired.

It stands for the financial commitment banks and NBFCs make to bring on new clients, including sales, marketing, and other associated expenses. Banks commit a large amount of their resources, including costs for staffing, advertising campaigns, plus marketing activities, to bringing in new business.

What Else Should You Know About CAC?

You may better understand the costs and efforts associated with bringing on new clients by using CAC and whether the earnings justify these expenditures. High customer acquisition costs (CAC) can reduce profitability and make it more difficult for a company to grow and expand, harming its ability to profit. If you cannot track and monitor these data and adjust your spending accordingly, a high cost-per-acquisition (CAC) may also indicate that your new client acquisition techniques are ineffective.