Market Insights Financial Banking Traditional Banks

Traditional Commercial Banking - India

India

In India, the Traditional Commercial Banking market market is expected to witness a significant increase in Net Interest Income.
By 2024, it is projected to reach a staggering amount of US$128.70bn.
This growth is indicative of the country's thriving banking sector.
Furthermore, the Net Interest Income is anticipated to display a promising annual growth rate (CAGR 2024-2028) of -1.11%.
As a result, the market volume is estimated to reach US$123.10bn by the year 2028.
This steady growth emphasizes the stability and potential of the Indian banking industry.
In a global context, it is worth noting that in China is expected to generate the highest Net Interest Income.
In 2024, in China's Net Interest Income is projected to be an impressive US$1,749.0bn.
This highlights in China's dominance in the global banking market.
Overall, the Traditional Commercial Banking market market in India is poised for substantial growth in terms of Net Interest Income.
With impressive figures and a promising trajectory, India's banking sector is set to play a significant role in the global financial landscape.
Despite the rapid growth of digital banking in India, traditional commercial banking continues to thrive due to the country's cultural preference for personal interactions and trust in established institutions.

Key regions: Brazil, China, South Korea, Japan, India

Definition:

Commercial banking refers to the financial services sector that provides a range of financial products and services to businesses, including small and large enterprises. Commercial banks offer services such as loans, lines of credit, and other financial products specifically designed for businesses. These services are critical to supporting the growth and development of businesses and the broader economy.
Commercial banks play a key role in the financial landscape by providing businesses with the funding they need to invest in new projects, hire employees, and expand their operations. They also offer a range of risk management services, such as trade financing and hedging solutions, to help businesses manage their financial risks.
The commercial banking market is highly competitive, with large global players as well as regional and local banks competing for business. Banks in this market are continually seeking ways to improve their offerings and remain competitive by leveraging technology and offering innovative financial products and services. Changes in regulations and the growing trend towards digitalization are also shaping the commercial banking market, creating opportunities for new entrants and forcing existing players to adapt.
Overall, commercial banking provides a vital range of financial services to businesses and is critical to supporting the growth and development of the broader economy.

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., JPMorgan Chase & Co., and HSBC Holdings.

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Analyst Opinion

The Traditional Commercial Banking market in India has been experiencing significant growth and evolution in recent years.

Customer preferences: Customers in the Traditional Commercial Banking market in India are increasingly seeking digital solutions and convenient banking services. The demand for online banking, mobile apps, and digital payment options has been on the rise as customers look for efficient and user-friendly ways to manage their finances.

Trends in the market: One of the key trends in the Traditional Commercial Banking market in India is the expansion of services to rural and underserved areas. With the government's focus on financial inclusion and initiatives such as Jan Dhan Yojana, banks are reaching out to remote regions to provide banking services to a larger population. Additionally, there is a growing trend towards personalized banking services and tailored financial products to meet the diverse needs of customers.

Local special circumstances: In India, the Traditional Commercial Banking market is also influenced by regulatory changes and government policies. The introduction of initiatives like the Goods and Services Tax (GST) and demonetization has had a significant impact on the banking sector, leading to changes in customer behavior and banking operations. Moreover, the presence of a large unbanked population in India presents both challenges and opportunities for banks to expand their reach and tap into new markets.

Underlying macroeconomic factors: The growth of the Traditional Commercial Banking market in India is closely tied to the country's overall economic performance. Factors such as GDP growth, inflation rates, and interest rates play a crucial role in shaping the banking landscape. As India continues to be one of the fastest-growing major economies in the world, the banking sector is poised for further development and innovation to cater to the evolving needs of customers.

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.