Market Insights Financial Banking Traditional Banks

Traditional Retail Banking - Asia

Asia

In Asia, the Traditional Retail Banking market market is expected to witness significant growth in Net Interest Income.
The projected figure for 2024 stands at US$3.12tn.
Looking ahead, the market is expected to experience a steady annual growth rate of 4.99% (CAGR 2024-2029), leading to a market volume of US$3.98tn by 2029.
When compared globally, it is worth noting that China will generate the highest Net Interest Income, with a projected amount of US$2,426.0bn in 2024.
In China, the traditional retail banking market is experiencing a shift towards digital banking, with mobile payment platforms gaining 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

Amid the dynamic landscape of Asia's Traditional Retail Banking market, customer preferences, trends, local special circumstances, and underlying macroeconomic factors play crucial roles in shaping the industry.

Customer preferences: Customers in Asia are increasingly seeking convenience and personalized services in their banking experience. With the rise of digitalization and technological advancements, there is a growing demand for online and mobile banking services. Additionally, customers are placing more emphasis on seamless and efficient transactions, as well as access to a wide range of financial products.

Trends in the market: In China, the Traditional Retail Banking market is witnessing a shift towards innovative digital solutions, driven by the tech-savvy population and the presence of leading fintech companies. Mobile payment platforms and online banking services are gaining significant traction, leading traditional banks to invest in digital transformation to stay competitive. In India, the market is experiencing a surge in the adoption of digital banking services, especially among the younger population. The government's push towards financial inclusion and the rapid expansion of internet connectivity are driving the growth of online banking and mobile payment solutions in the country.

Local special circumstances: In Japan, where the population is aging rapidly, traditional banks are facing the challenge of catering to the needs of elderly customers who prefer in-person banking services. As a result, banks in Japan are focusing on maintaining a balance between traditional brick-and-mortar branches and digital channels to serve a diverse customer base. In Indonesia, the archipelago's geographical diversity poses challenges for traditional banks in reaching rural and remote areas. To address this, banks are increasingly leveraging agent banking and mobile banking services to extend their reach and provide financial services to unbanked populations in the country.

Underlying macroeconomic factors: The economic growth and rising middle-class population in many Asian countries are driving the expansion of the Traditional Retail Banking market. As disposable incomes increase, there is a greater demand for savings, investment products, and loans, leading banks to innovate and diversify their offerings to meet the evolving needs of customers. Additionally, regulatory reforms and government initiatives to promote financial inclusion are shaping the competitive landscape of the banking sector in Asia.

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.