Market Insights Financial Banking Traditional Banks

Traditional Retail Banking - Pakistan

Pakistan

In Pakistan, the Traditional Retail Banking market market is expected to witness a significant increase in Net Interest Income.
According to projections, the Net Interest Income is set to reach US$46.92bn in 2024.
Furthermore, it is anticipated that the market will continue to grow at a compound annual growth rate (CAGR 2024-2029) of 5.18%, resulting in a market volume of US$60.41bn by 2029.
When compared globally, it is worth noting that China will generate the highest Net Interest Income in 2024, with a staggering amount of US$2,426.0bn.
The traditional retail banking sector in Pakistan is experiencing a surge in digital banking services, as customers increasingly prefer online and mobile banking options over physical branch visits.

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

Pakistan's Traditional Retail Banking market is experiencing notable developments driven by changing customer preferences, market trends, local special circumstances, and underlying macroeconomic factors.

Customer preferences: Customers in Pakistan are increasingly looking for convenience and accessibility in their banking services. This has led to a growing demand for digital banking solutions and online services, as customers seek more efficient ways to manage their finances. Additionally, there is a preference for personalized services and tailored financial products that meet the specific needs of individual customers.

Trends in the market: One of the key trends in the Traditional Retail Banking market in Pakistan is the expansion of branch networks in urban as well as rural areas. Banks are focusing on increasing their physical presence to cater to a wider customer base and provide more personalized services. Moreover, there is a growing trend towards offering Islamic banking products to meet the needs of the Muslim population in the country.

Local special circumstances: Pakistan's Traditional Retail Banking market is influenced by the country's regulatory environment, which plays a crucial role in shaping the operations of banks. The State Bank of Pakistan, as the central bank, sets the regulatory framework that banks must adhere to. Additionally, the socio-economic landscape of Pakistan, including factors such as income levels, literacy rates, and cultural preferences, also impact the banking sector in the country.

Underlying macroeconomic factors: The Traditional Retail Banking market in Pakistan is influenced by macroeconomic factors such as GDP growth, inflation rates, and interest rates. Economic stability and growth in the country contribute to increased consumer confidence and higher spending, which in turn drive the demand for banking services. Moreover, government policies and initiatives aimed at promoting financial inclusion and expanding access to banking services also play a significant role in shaping the market trends in Pakistan's 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.