Retail banking: Key market highlights
- Quick access to credit is the driving force for market growth
- Adoption of big data analytics is an ongoing trend in the market
- Key vendors—BNP Paribas, Citigroup, HSBC, ICBC, and JPMorgan Chase
Technavio’s market research analysts estimate the global retail banking market to grow at a CAGR of over 6% between 2016 and 2020. The market is primarily driven by the quick access to credit. Traditional banking institutions are attempting to address specific needs of potential clients to reduce the huge funding gap between large corporate and small and medium-sized enterprises (SMEs). Retail banks provide different source of financing, especially for micro, small, and medium-size enterprises (MSMEs) in emerging as well as developed countries. During 2015, EMEA dominated the global retail banking market by occupying around 44% of the overall market share. Powerful improvements in the business models by making use of digital channels, adjustments in the customer proposition in the MSME and affluent segments, and reshaping the branch networks are some of the factors that are likely to fuel growth in the market during the forecast period.
The new industry research report from Technavio discusses in detail the key drivers and trends responsible for the growth of this market and its sub-segments.
“The adoption of big data analytics is an upcoming trend in the market currently. Numerous top retail banking institutions are emphasizing on expense management to increase the profit margin of their business. There’s a shift in focus from stand-alone technology projects to an environment where there is continuous technological improvement. There are numerous tie-ups between data analytics companies and retail banks in an attempt to improve underwriting profits and lower the loss ratio,” says Amit Sharma, Lead Analyst, ICT, Technavio Research.
Online receivable financing is a trend that is attracting a lot of key market players, competitors, and customers to have open competitive auctions. Retail banking institutions are now shifting their focus to the online receivable financing platform, which can help companies fulfil their working capital needs and individuals to lend and borrow money on a day-to-day basis. The reduction in the cost of capital also helps achieve competitive prices.
The key vendors in the retail banking market are BNP Paribas, Citigroup, HSBC, ICBC, and JPMorgan Chase. At present, the banks are focusing on consumer protection which has propelled them to formulate proper pricing models for each product and service. It is important for retails banks to have a competitive, risk-based and value added pricing to retain their customers. The retail banking sector has huge growth potential for innovations in the developing countries where the bank-led financial inclusion model exists. These developments will open up new sources of revenue and new channels of profit for retail banks during the forecast period.
A more detailed analysis is available in the Technavio report, Global Retail Banking Market 2016-2020.
We can customize reports by other regions and specific segments upon request.
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