Market Insights Financial Banking Traditional Banks

Traditional Retail Banking - GCC

In the GCC, the Traditional Retail Banking market market is anticipated to witness a significant growth in Net Interest Income.
By 2024, it is projected to reach a value of US$24.02bn.
Looking ahead, the market is expected to display a Compound Annual Growth Rate (CAGR 2024-2028) of 5.50%, leading to a market volume of US$29.76bn by 2028.
When compared globally, it is noteworthy that in China is expected to generate the highest Net Interest Income.
In 2024, in China is projected to reach a substantial value of US$2,941.0bn.
In the GCC, traditional retail banking is experiencing a decline in popularity as digital banking services gain traction.

Key regions: Singapore, Germany, India, Japan, South Korea

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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Region comparison

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Analyst Opinion

The Traditional Retail Banking market in GCC is undergoing significant developments and trends that are shaping the industry in the region.

Customer preferences: Customers in the GCC region are increasingly demanding more personalized and convenient banking services. With the rise of digitalization and technological advancements, customers are looking for seamless online and mobile banking experiences. Moreover, there is a growing interest in sustainable banking practices and ethical investments among customers in the region.

Trends in the market: In Saudi Arabia, the largest economy in the GCC, there is a noticeable trend towards the adoption of fintech solutions in the traditional retail banking sector. This trend is being driven by the government's push towards digital transformation and financial inclusion. As a result, traditional banks are partnering with fintech companies to enhance their service offerings and reach a wider customer base.

Local special circumstances: The UAE, a key player in the GCC banking sector, is witnessing a shift towards digital banking channels. With a tech-savvy population and a high smartphone penetration rate, UAE customers are increasingly embracing online and mobile banking services. Traditional banks in the UAE are investing heavily in digital infrastructure to cater to the evolving needs of their customers and stay competitive in the market.

Underlying macroeconomic factors: The economic diversification efforts in the GCC countries are driving the growth of the traditional retail banking market. As these countries reduce their reliance on oil revenues and focus on developing non-oil sectors, there is a growing demand for banking services to support the expanding economy. Additionally, favorable government policies and regulatory frameworks are encouraging innovation and competition in the traditional retail banking sector across the GCC.

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.