Traditional Banks - Cambodia

Cambodia

In Cambodia, the Traditional Banks market market is expected to witness a significant increase in Net Interest Income, reaching US$2.98bn by 2024.
The dominant player in this market segment is Traditional Retail Banking, projected to have a market volume of US$2.04bn by 2024.
Looking ahead, the Net Interest Income is anticipated to display a Compound Annual Growth Rate (CAGR 2024-2029) of 4.87%, resulting in a market volume of US$3.78bn by 2029.
In a global perspective, in China is expected to generate the highest Net Interest Income, amounting to US$3,869.0bn in 2024.
Traditional banks in Cambodia are facing increasing competition from digital banking platforms, forcing them to innovate and offer more convenient and accessible services to retain customers.

Key regions: Germany, United Kingdom, France, Japan, China

Definition:

The Traditional Retail and Commercial Banks 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. 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.
The traditional banking market is highly competitive and characterized by the presence of large global players as well as regional and local banks. These banks have a long history of serving customers and have established relationships and a deep understanding of the financial needs of their communities. They offer a wide range of services and are able to provide personalized advice and support to their customers.
In this market, banks are continually seeking ways to improve their offerings and remain competitive by leveraging technology and offering innovative financial products and services. However, they also face challenges, such as increased competition and changing customer preferences, which are driving the need for continuous improvement and adaptation.
Overall, the traditional retail and commercial banking market provides a wide range of financial services to both individuals and businesses through established, trusted channels and continues to play a vital role in the financial landscape.

Structure:

The market consists of two segments:
- The Traditional Retail Banks market refers to financial services provided to individual consumers (e.g., personal loans, savings and checking accounts, credit cards, mortgages).
- The Traditional Commercial Banks market refers to financial services provided to businesses, including small and large enterprises (loans, lines of credit, other financial products specifically designed for businesses).

The market data comprises Net Interest Income, the value of Deposits, the value of Loans, 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 and commercial banking market, creating opportunities for new entrants and forcing existing players to adapt.

Key players in this market are companies such as Industrial and Commercial Bank of China Ltd., JPMorgan Chase & Co., and HSBC Holdings.

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Analyst Opinion

Over the past few years, the Traditional Banks market in Cambodia has been experiencing significant growth and development.

Customer preferences: Customers in Cambodia have shown a strong preference for traditional banking services due to a combination of factors such as trust, reliability, and the personal touch offered by brick-and-mortar bank branches. Many Cambodians still prefer face-to-face interactions when it comes to managing their finances, which has contributed to the sustained demand for traditional banking services in the country.

Trends in the market: One of the key trends shaping the Traditional Banks market in Cambodia is the increasing adoption of digital banking services. While traditional banks remain popular, there is a growing demand for online and mobile banking solutions, especially among the younger population. Traditional banks in Cambodia are adapting to this trend by investing in digital infrastructure and enhancing their online banking capabilities to cater to the evolving needs of customers.

Local special circumstances: In Cambodia, the banking sector is still relatively nascent compared to more developed markets, which presents both opportunities and challenges for traditional banks. The government's efforts to promote financial inclusion and improve access to banking services have created a favorable environment for traditional banks to expand their reach and customer base. Additionally, the stability of the Cambodian economy and the increasing disposable income of the population have also contributed to the growth of the Traditional Banks market in the country.

Underlying macroeconomic factors: The steady economic growth, rising middle class, and increasing urbanization in Cambodia are key macroeconomic factors driving the development of the Traditional Banks market. As more Cambodians move to urban areas and experience improvements in their living standards, the demand for banking products and services is expected to continue growing. Moreover, the government's focus on strengthening the regulatory framework and promoting financial stability has instilled confidence in the banking sector, attracting both domestic and foreign investments in traditional banks.

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.