Market Insights Financial Banking Traditional Banks

Traditional Retail Banking - Africa

Africa

In Africa, the Traditional Retail Banking market market is expected to witness a significant increase in Net Interest Income, reaching a projected value of US$126.20bn by the year 2024.
Furthermore, it is anticipated that this segment will maintain a steady growth rate of -0.50% annually (CAGR 2024-2029), ultimately leading to a market volume of US$123.10bn by 2029.
It is worth noting that in the global context, China is expected to generate the highest Net Interest Income, amounting to US$2,426.0bn in 2024.
In Nigeria, traditional retail banking is experiencing a decline as digital banking platforms gain popularity among consumers.

Key regions: France, Brazil, Germany, United Kingdom, United States

Definition:
Traditional retail banking refers to the financial services sector that provides a range of financial products and services to individual consumers through store-based branches and other traditional channels. These services include personal loans, savings and checking accounts, credit cards, mortgages, and other financial products designed specifically for individual consumers.
Traditional retail 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.
Despite facing increased competition and changing customer preferences, traditional retail banks continue to play a vital role in the financial landscape. They are continually seeking ways to improve their offerings and remain competitive by leveraging technology and offering innovative financial products and services.
Overall, traditional retail banking provides a wide range of financial services to individual consumers through established, trusted channels and continues to be an important part of the financial landscape.

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., Bank of America Corp., and BNP Paribas.

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Analyst Opinion

The Traditional Retail Banking market in Africa has been experiencing significant developments and trends in recent years.

Customer preferences: Customers in the African Traditional Retail Banking market are increasingly seeking convenience and accessibility in their banking services. This has led to a growing demand for digital banking solutions such as mobile banking and online banking platforms. Customers are also looking for personalized services and tailored financial products that meet their specific needs and preferences.

Trends in the market: In Nigeria, one of the largest economies in Africa, the Traditional Retail Banking market has been witnessing a surge in digital banking adoption. With a large population of tech-savvy individuals, Nigerian banks are investing heavily in digital infrastructure to cater to the growing demand for online and mobile banking services. This trend is driven by the increasing internet penetration and smartphone usage in the country.

Local special circumstances: In South Africa, the Traditional Retail Banking market is characterized by a highly competitive landscape with a mix of local and international banks. Customer loyalty is a key factor for banks operating in the South African market, leading to a focus on customer retention strategies and innovative product offerings. Additionally, regulatory requirements and compliance standards play a significant role in shaping the banking sector in South Africa.

Underlying macroeconomic factors: The growth of the Traditional Retail Banking market in Africa is also influenced by macroeconomic factors such as GDP growth, inflation rates, and government policies. Countries with stable economic conditions and favorable regulatory environments tend to attract more investments in the banking sector. Additionally, demographic trends such as population growth and urbanization play a key role in shaping the demand for banking services in African countries.

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.