Banking - Iran

Iran

In Iran, the Banking market is anticipated to witness a significant growth in Net Interest Income, with projections indicating that it will reach US$124.40bn by the year 2024.
Traditional Banks are expected to dominate this market segment, with a projected market volume of US$118.60bn by 2024.
Furthermore, the Net Interest Income in the Banking market sector is expected to display a compound annual growth rate (CAGR) of 1.56% between 2024 and 2029.
This growth rate is predicted to result in a market volume of US$134.40bn by the year 2029.
When compared to other countries globally, it is worth noting that China is projected to generate the highest Net Interest Income.
In 2024, China's Net Interest Income is estimated to be around US$4,332.0bn.
Iran's banking market is experiencing a surge in digital banking services, with more customers opting for online transactions.

Key regions: United States, China, Japan, Brazil, United Kingdom

Definition:

The Banking market refers to the financial services sector providing financial products and services to individuals and businesses. Retail banking focuses on offering financial services to individual consumers, such as personal loans, savings and checking accounts, credit cards, and mortgages. Commercial banking, on the other hand, provides financial services to small and large businesses, including loans, lines of credit, and other financial products designed specifically for businesses.

Structure:

The market consists of two segments:
- The Traditional Banking market refers to the financial services sector that provides a range of financial products and services to individuals and businesses through store-based branches and other traditional channels.
- The Digital Banking market refers to the emerging market for digital-only banks that offer financial services through online and mobile platforms.

The market data comprises Net Interest Income, Bank Account Penetration rate, the value of Deposits, the number of depositors, the value of Loans, the number of borrowers, Credit Card Interest Income, the number of ATMs as well as the number of Bank Branches.

Additional information:

The Banking market is highly competitive and characterized by the presence of large global players as well as regional and local banks. Banks are continually seeking ways to improve their offerings and remain competitive by leveraging technology and offering innovative financial products and services. Additionally, changes in regulations and the growing trend toward digitalization are shaping the Retail & Commercial banking market, creating opportunities for new entrants, and forcing existing players to adapt.
Key players in this market are companies such as the Industrial and Commercial Bank of China Ltd., JPMorgan Chase & Co., and HSBC Holdings.

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Analyst Opinion

Iran's Banking market has been experiencing significant growth and development in recent years.

Customer preferences: Customers in Iran are increasingly looking for digital banking solutions that offer convenience and efficiency. The younger population, in particular, is driving the demand for online and mobile banking services. Additionally, there is a growing interest in Islamic banking products that comply with Sharia law.

Trends in the market: One notable trend in the Iranian Banking market is the expansion of fintech companies offering innovative financial services. These fintech firms are disrupting traditional banking models and catering to the evolving needs of tech-savvy customers. Another trend is the emphasis on financial inclusion, with efforts to provide banking services to underserved populations in rural areas.

Local special circumstances: Iran's Banking market is unique due to the country's geopolitical situation and economic sanctions. These factors have influenced the market structure and limited foreign investment and participation. As a result, domestic banks play a dominant role in the industry, facing both challenges and opportunities in a restricted global financial environment.

Underlying macroeconomic factors: The development of Iran's Banking market is also influenced by macroeconomic factors such as inflation, interest rates, and government policies. Economic stability and regulatory reforms are crucial for sustaining growth and attracting investment in the banking sector. Additionally, international relations and sanctions relief can have a significant impact on the market dynamics and opportunities for expansion.

Methodology

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on Net Interest Income, Bank Account Penetration rate, the value of Deposits, the number of depositors, the value of Loans, the number of borrowers, Credit Card Interest Income, the number of ATMs as well as the number of Bank Branches.

Modeling approach / Market size:

Market sizes are determined by a combined Top-Down and Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use data provided by the IMF, World Bank and the annual reports of the top 1000 Banks by asset size. Next we use relevant key market indicators and data from country-specific associations such as GDP, deposit interest rates, lending interest rates or bank account penetration rates. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. For example, the S-curve function and exponential trend smoothing are well suited to forecast financial services for digital as well as traditional products and services.

Additional Notes:

The market is updated twice per year in case market dynamics change.