Market Insights Financial Banking Traditional Banks

Traditional Retail Banking - Mexico

Mexico

In Mexico, the Traditional Retail Banking market market is expected to see a significant increase in Net Interest Income, projected to reach US$24.49bn in 2024.
This growth is anticipated to continue at an annual rate of 6.02% from 2024 to 2029, resulting in a market volume of US$32.81bn by the end of that period.
When compared globally, it is worth noting that China is expected to generate the highest Net Interest Income in 2024, with a projected amount of US$2,426.0bn.
In Mexico, traditional retail banking is facing increased competition from digital banking platforms, forcing banks to adopt innovative strategies to retain customers.

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 Mexico is experiencing a shift in customer preferences, trends, and local special circumstances that are shaping its development.

Customer preferences: Mexican customers are increasingly leaning towards digital banking solutions, driven by the convenience and accessibility they offer. The younger population, in particular, is more inclined to use online and mobile banking services for their everyday financial needs. This shift is also influenced by the growing tech-savvy population and the desire for instant and efficient banking services.

Trends in the market: One prominent trend in the Mexican Traditional Retail Banking market is the emphasis on financial inclusion. Banks are expanding their reach to underserved communities and offering tailored products and services to cater to a wider customer base. Additionally, there is a growing trend towards personalized banking experiences, with banks leveraging data analytics and AI to provide customized solutions to their customers. Furthermore, partnerships between traditional banks and fintech companies are on the rise, leading to the development of innovative products and services in the market.

Local special circumstances: Mexico's Traditional Retail Banking market is unique due to its regulatory environment and cultural factors. The regulatory landscape in Mexico plays a significant role in shaping the market dynamics, with strict regulations governing the operations of banks and financial institutions. Moreover, cultural preferences and traditions influence the way banking services are perceived and utilized in the country. Building trust and establishing long-term relationships with customers are essential in the Mexican market, given the importance of personal connections in business dealings.

Underlying macroeconomic factors: The development of the Traditional Retail Banking market in Mexico is also influenced by macroeconomic factors such as economic growth, inflation rates, and interest rates. A stable economic environment generally fosters confidence among consumers and businesses, leading to increased demand for banking services. Additionally, fluctuations in interest rates impact borrowing and saving behaviors, which in turn affect the revenue streams of banks operating in the market. Keeping abreast of these macroeconomic factors is crucial for banks to navigate the competitive landscape and sustain growth in the Mexican market.

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.