Banking - Papua New Guinea

Papua New Guinea

In Papua New Guinea, the Banking market is expected to see a significant increase in Net Interest Income, reaching US$865.80m in 2024.
Traditional Banks are the dominant players in this market segment, with a projected market volume of US$792.30m in the same year.
Looking ahead, the Net Interest Income is expected to grow at an annual rate of -2.21% (CAGR 2024-2029), resulting in a market volume of US$774.20m by 2029.
When comparing the global market, it is worth noting that in China will generate the highest Net Interest Income, projected to reach US$4,332.0bn in 2024.
Papua New Guinea's banking sector is experiencing a surge in digital banking services, allowing greater access to financial services for its remote and rural population.

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

The Banking market in Papua New Guinea is experiencing significant growth and development in response to various factors influencing the industry.

Customer preferences: Customers in Papua New Guinea are increasingly seeking convenient and accessible banking services. With the rise of digital technology, there is a growing demand for online and mobile banking solutions that offer flexibility and ease of use. Additionally, customers are looking for a wide range of financial products and services to meet their diverse needs, from basic savings accounts to more sophisticated investment options.

Trends in the market: One of the key trends shaping the Banking market in Papua New Guinea is the expansion of branch networks to reach more remote areas. As the population becomes more financially included, banks are focusing on increasing their presence in underserved regions to cater to the unbanked population. Moreover, there is a growing trend towards sustainable banking practices, with an emphasis on environmental and social responsibility in the wake of global trends.

Local special circumstances: Papua New Guinea's unique geographical landscape presents challenges and opportunities for the Banking market. The country's diverse population spread across various islands necessitates innovative approaches to banking infrastructure and service delivery. Additionally, the presence of a large informal economy calls for tailored financial solutions to address the specific needs of this segment of the population.

Underlying macroeconomic factors: The economic growth and stability of Papua New Guinea play a crucial role in shaping the Banking market. As the country continues to develop and modernize its financial sector, there are opportunities for banks to expand their operations and introduce new products and services. Furthermore, regulatory reforms and government initiatives aimed at promoting financial inclusion are driving the evolution of the Banking market in Papua New Guinea.

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.