Banking - Jordan

Jordan

In 2024, the projected Net Interest Income in the Banking market of Jordan is expected to reach US$3,303.00m.
Traditional Banks are expected to dominate the market with a projected market volume of US$3,271.00m in 2024.
The Net Interest Income is expected to show an annual growth rate (CAGR 2024-2029) of 4.54%, resulting in a market volume of US$4,124.00m by 2029.
In global comparison, China is expected to generate the highest Net Interest Income, reaching US$4,332.0bn in 2024.
Despite facing economic challenges, the banking sector in Jordan has shown resilience and stability, with a focus on digital transformation and innovation to cater to the needs of tech-savvy customers.

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

Jordan's Banking market is experiencing significant growth and development, driven by various factors shaping the industry in the country.

Customer preferences: Customers in Jordan are increasingly seeking digital banking solutions, leading to a rise in online and mobile banking services. Convenience, speed, and 24/7 accessibility are key factors driving this shift in customer preferences. Moreover, personalized services and tailored financial products are becoming more popular among customers looking for a more individualized banking experience.

Trends in the market: One notable trend in the Jordanian Banking market is the increasing competition among banks to innovate and offer technologically advanced solutions. Fintech companies are also playing a significant role in shaping the market landscape by introducing innovative payment methods and financial services. Additionally, sustainable banking practices and socially responsible investments are gaining traction as customers become more conscious of environmental and social issues.

Local special circumstances: Jordan's strategic location and stable economic environment have attracted foreign investments in the banking sector, leading to collaborations between local and international financial institutions. The government's efforts to promote financial inclusion and support small and medium enterprises are also contributing to the growth of the banking market. Moreover, the young population in Jordan with a high percentage of tech-savvy individuals is driving the adoption of digital banking services in the country.

Underlying macroeconomic factors: The stability of Jordan's economy, coupled with prudent regulatory measures, has fostered a favorable environment for the banking sector to thrive. The government's initiatives to modernize the financial infrastructure and promote a cashless economy are further propelling the growth of the banking market. Additionally, the country's strong ties with regional and international markets are creating opportunities for banks to expand their operations and offer a diverse range of financial products and services to customers.

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.