Traditional Banks - MENA

MENA

Net Interest Income in the Traditional Banks market is projected to reach US$374.20bn in 2024.
Traditional Retail Banking dominates the market with a projected market volume of US$223.60bn in 2024.
Net Interest Income is expected to show an annual growth rate (CAGR 2024-2029) of 3.15%, resulting in a market volume of US$437.00bn by 2029.
In global comparison, most Net Interest Income will be generated in China (US$3,869.0bn in 2024).

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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Market

Region

Region comparison

Currency

Analyst Opinion

Amidst increasing digitalization and changing consumer behaviors, the Traditional Banks market in MENA is witnessing notable shifts and developments.

Customer preferences: Customers in the MENA region are showing a growing inclination towards digital banking services, driven by convenience, speed, and accessibility. Traditional banks are adapting to meet these preferences by investing in digital infrastructure and offering online banking solutions to cater to the evolving needs of their customer base.

Trends in the market: In Saudi Arabia, traditional banks are focusing on expanding their product offerings and enhancing customer experience through personalized services. The market is witnessing a trend towards more innovative financial products and services to attract and retain customers in a competitive landscape. In the UAE, traditional banks are increasingly collaborating with fintech companies to leverage their technological capabilities and enhance their service offerings. This trend is driven by the desire to stay competitive in a market where customer expectations are rapidly evolving.

Local special circumstances: In Egypt, the Traditional Banks market is experiencing a period of regulatory changes aimed at promoting financial inclusion and enhancing the stability of the banking sector. Traditional banks are adapting to these changes by expanding their reach to underserved populations and diversifying their product portfolios to meet the needs of a broader customer base.

Underlying macroeconomic factors: The economic diversification efforts in the MENA region are creating opportunities for traditional banks to expand their services and tap into new market segments. As the region continues to develop and modernize, traditional banks are well-positioned to play a vital role in supporting economic growth and financial stability.

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.