Market Insights Financial Banking Traditional Banks

Traditional Commercial Banking - Peru

Peru

In Peru, the Traditional Commercial Banking market market is anticipated to witness a substantial increase in Net Interest Income, reaching a projected value of US$17.70bn in 2024.
Moreover, the sector is expected to maintain a steady growth rate, with a compound annual growth rate (CAGR) of 3.68% from 2024 to 2029.
Consequently, the market volume is forecasted to expand to US$21.21bn by 2029.
When examining global comparisons, it is noteworthy that China is projected to generate the highest Net Interest Income, amounting to US$1,444.0bn in 2024.
Peru's traditional commercial banking market remains resilient, adapting to evolving customer demands and leveraging innovative digital solutions for enhanced customer experience.

Key regions: China, France, Brazil, Singapore, India

Definition:

Commercial banking refers to the financial services sector that provides a range of financial products and services to businesses, including small and large enterprises. Commercial banks offer services such as loans, lines of credit, and other financial products specifically designed for businesses. These services are critical to supporting the growth and development of businesses and the broader economy.
Commercial banks play a key role in the financial landscape by providing businesses with the funding they need to invest in new projects, hire employees, and expand their operations. They also offer a range of risk management services, such as trade financing and hedging solutions, to help businesses manage their financial risks.
The commercial banking market is highly competitive, with large global players as well as regional and local banks competing for business. Banks in this market are continually seeking ways to improve their offerings and remain competitive by leveraging technology and offering innovative financial products and services. Changes in regulations and the growing trend towards digitalization are also shaping the commercial banking market, creating opportunities for new entrants and forcing existing players to adapt.
Overall, commercial banking provides a vital range of financial services to businesses and is critical to supporting the growth and development of the broader economy.

Structure:

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

The Traditional Commercial Banking market in Peru has been experiencing notable developments in recent years.

Customer preferences: Peruvian customers are increasingly seeking personalized banking services that cater to their specific needs and preferences. They are looking for convenient digital banking solutions that offer ease of access and seamless transactions. Additionally, there is a growing demand for sustainable banking practices among customers who prioritize environmental and social responsibility.

Trends in the market: One of the key trends in the Traditional Commercial Banking market in Peru is the rapid adoption of digital banking services. With the increasing penetration of smartphones and internet connectivity across the country, more customers are turning to online and mobile banking for their financial needs. This trend is driving traditional banks to invest in digital infrastructure and innovative technologies to stay competitive in the market.

Local special circumstances: Peru's banking sector is unique due to its diverse customer base spread across urban and rural areas. While urban customers are more inclined towards digital banking services, rural customers still rely heavily on traditional brick-and-mortar branches for their banking needs. This dual requirement poses a challenge for banks to maintain a balance between digital offerings and physical presence to cater to all customer segments effectively.

Underlying macroeconomic factors: The economic stability and steady GDP growth in Peru have contributed to the expansion of the Traditional Commercial Banking market. As more Peruvians enter the formal banking system, there is a growing opportunity for banks to offer a wide range of financial products and services. Additionally, favorable government regulations and initiatives to promote financial inclusion have created a conducive environment for the growth of the banking sector in the country.

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.