Market Insights Financial Banking Traditional Banks

Traditional Retail Banking - United States

United States

In the United States, the Traditional Retail Banking market market is expected to witness a significant increase in Net Interest Income.
By 2024, it is projected to reach a staggering US$188.50bn.
Looking ahead, the market is anticipated to grow at an annual compound growth rate (CAGR 2024-2028) of -12.78%.
This growth trajectory indicates that the Net Interest Income in the Traditional Retail Banking market sector will expand to a market volume of approximately US$109.10bn by 2028.
It is noteworthy that in China will continue to dominate the global comparison, generating the highest Net Interest Income of US$188.50bn in 2024.
As the United States embraces digital banking, traditional retail banks are adapting by offering innovative online and mobile banking services to remain competitive in the market.

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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Analyst Opinion

The Traditional Retail Banking market in United States is experiencing a shift in customer preferences and trends due to local special circumstances and underlying macroeconomic factors.

Customer preferences: Customers in the United States are increasingly gravitating towards digital banking solutions, preferring the convenience of online and mobile banking services. This shift is driven by the desire for 24/7 access to banking services, seamless transactions, and personalized financial management tools.

Trends in the market: One notable trend in the Traditional Retail Banking market in the United States is the rise of neobanks and fintech companies challenging traditional banks. These innovative players are disrupting the market with their user-friendly interfaces, competitive interest rates, and agile decision-making processes. As a result, traditional banks are investing heavily in digital transformation to stay competitive and meet evolving customer expectations.

Local special circumstances: The regulatory environment in the United States plays a significant role in shaping the Traditional Retail Banking market. Compliance requirements, such as the Dodd-Frank Act and Consumer Financial Protection Bureau regulations, impact how banks operate and innovate. Additionally, the competitive landscape, with a mix of large national banks, regional banks, and community banks, influences customer choices and market dynamics.

Underlying macroeconomic factors: The economic conditions in the United States, including interest rates, inflation, and unemployment rates, have a direct impact on the Traditional Retail Banking market. Fluctuations in these macroeconomic indicators can influence consumer spending, saving habits, and borrowing patterns, ultimately shaping the demand for banking products and services. Additionally, demographic shifts, such as the aging population and changing workforce dynamics, present both challenges and opportunities for banks to cater to diverse customer segments.

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.