Market Insights Financial Banking Traditional Banks

Traditional Retail Banking - Ethiopia

Ethiopia

In Ethiopia, the Traditional Retail Banking market market is expected to witness a significant increase in Net Interest Income, reaching a projected value of US$2.05bn in 2024.
This growth is anticipated to continue with an annual growth rate (CAGR 2024-2029) of 5.03%, leading to a market volume of US$2.62bn by 2029.
When compared globally, it is noteworthy that China is projected to generate the highest Net Interest Income, with an estimated value of US$2,426.0bn in 2024.
Despite the rapid growth of digital banking in Ethiopia, traditional retail banking still remains the preferred choice for the majority of the population.

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 Ethiopia is experiencing significant growth and development in recent years.

Customer preferences: Customers in Ethiopia are increasingly seeking convenient and accessible banking services, driving the demand for traditional retail banking products. With a growing middle class and urban population, there is a rising need for various banking services such as savings accounts, loans, and payment solutions.

Trends in the market: One of the key trends in the Traditional Retail Banking market in Ethiopia is the expansion of banking infrastructure and technology. Many banks are investing in digital banking platforms and mobile banking services to reach a larger customer base and provide efficient services. Additionally, there is a trend towards offering tailored products and services to meet the specific needs of different customer segments.

Local special circumstances: Ethiopia's banking sector is heavily regulated by the government, with restrictions on foreign ownership and operations. This has created a unique market environment where local banks dominate the industry, limiting competition from international players. As a result, traditional retail banks in Ethiopia focus on building strong relationships with local customers and communities to drive business growth.

Underlying macroeconomic factors: The economic growth and stability in Ethiopia have played a significant role in the development of the Traditional Retail Banking market. With a stable GDP growth rate and increasing foreign direct investment, there is a growing demand for banking services to support business activities and personal financial needs. Additionally, the government's efforts to improve financial inclusion and promote a cashless economy have also contributed to the expansion of the retail banking sector.

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.