Global digital banking market has witnessed significant
boost in recent years, thanks to the various technological advancements
happening in the banking sector. Banking institutions are using technologies
and devices like Artificial Intelligence (AI) and Internet of Things (IoT) to
not only improve the products and services offered by them but to enhance the
overall customer experience as well.
The COVID-19 pandemic played a pivotal role in increasing
the use of digital banking solutions among customers across the world as
several governments had imposed movement restrictions and lockdowns. This
forced many people to turn to online banking channels to conduct their daily
transactions. The pandemic posed a challenge for the banks and financial
institutions as well because they had to think of creative ways to use the
digital medium.
Many smaller and lesser-known banks had to go digital in
order to retain their existing customer base and increase their presence in
different nations across the globe. Retail shopping saw a boost in its online
sales as more customers preferred online shopping platforms. This gave smaller
businesses an opportunity to widen their customer base and expand in different
areas. People who were already in the field of digital business were
flourishing during the pandemic.
The trends that will boost the development of global digital
banking industry are given below:
Online investment banking activities will rise in Asia
Pacific:
Asia Pacific digital banking market will exceed valuation of
nearly $8 billion by 2026. The digital investment banking segment is expected
to grow at more than 10% CAGR through 2026. This is because the region is
witnessing rapid internet penetration which has made more financial products
and services easily available for a wide range of customers.
Investment banking has become much easier today as compared
to a few years ago as people then would solely rely on the suggestions of their
brokers and then take important investment decisions. However, that is not the
case today as people are increasingly participating and learning the tricks of
the stock exchange on their own, thanks to millions of online investment
platforms available. E-trading has played an important role in saving time,
money and energy of several investors as the stock markets can be accessed with
the help of smartphones.
Mobile payments will benefit APAC digital banking market:
Developing countries in APAC region are witnessing heavy
adoption of NFC and POS terminals because of the rapid digitization happening
in these nations. Banking services in these economies are taking the digital
route to not just increase the customer base but to expand their business as
well. High-end gadgets like tablets and smartphones are experiencing rapid rise
in their demand among consumers in India, Indonesia, Philippines and Malaysia,
leading to the introduction of mobile wallets.
These wallets are a digitized version of physical wallets
and perform functions like making payments and cash withdrawals. Mobile wallets
provide security to the cash stored unlike physical ones. The increase in use
of mobile wallets has compelled retail shops to get themselves integrated with
online payment platforms to accept mobile payments. All these factors will
create a positive impact on digital banking market size in Asia Pacific region.
Strategic alliances to innovate digital baking products:
Several companies that are a part of digital banking market
in Asia Pacific are getting into strategic alliances with other fintech firms.
They aim to create innovative products and services to serve banking customers
in a better manner. In January 2019, Western Union announced its partnership
with Kakaobank of Korea Corporation to launch Western Union money transfer
services in an app created by Kakaobank. This partnership was quite beneficial
for the customers of Kakaobank as they were able to send and receive money with
the help of this app, thereby enhancing their overall experience.
Digital corporate banking services will gain momentum in
Europe:
Digital banking market size in Europe is expected to surpass
$2 billion by 2026. Corporate banking segment is estimated to grow at nearly 5%
CAGR during the forecast period of 2020-2026. One of the major reasons for this
is the increasing need among customers to reduce the high number of formalities
and complexities involved in the banking sector. Conventional banks often have
many portals and rivals, thereby making life difficult for corporate customers
who want to maintain different accounts for their business.
This is where digital banking solutions are useful as they
provide an online dashboard that has complete information in a consolidated
format. This helps the corporate customers in viewing the history of their
transactions and even provide financial projections of their cash position in
the form of graphs.
Canada will see higher demand for digital banking
services:
Canada digital banking market is expected to show
exponential progress during the forecast period of 2020-2026. The country has
been quick to adopt some of the most advanced banking technologies to improve
their financial infrastructure. There are a large number of customers today
that are using digital banking platforms to complete their daily transactions.
The Canadian Imperial Bank of Commerce, in August 2020,
announced its plan to use the CRM platform of Salesforce to improve the overall
experience of customers. The bank aims to provide end-to-end digitization
services and advanced analytics to encourage customers to use digital banking
services.
Increasing use of retail baking in North America:
Financial apps on mobile devices are experiencing an
incredible surge in demand among consumers in North America. This is because
they provide ease in doing transactions. People can now receive all kinds of
information related to their financial transactions on their smartphones and
tablets. This has prompted financial institutions to make changes in their
functions and make them more suitable for online banking operations. It has
resulted in improved experience for customers and has benefited the banks as
well.
Some of the top financial institutions providing digital
banking services across the world are Intellect Design Arena Ltd., The Bank of
New York Mellon Corporation, CREALOGIX AG, ebankIT, Fidor Solutions AG, TATA
Consultancy Services Limited and many others.
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