The global digital banking market registered a revenue of nearly $803.8 billion in 2018 and is anticipated to grow at a 10.0% CAGR, surpassing $1,702.4 billion by 2026. The market has witnessed a significant growth previously, but due to the unexpected COVID-19 outbreak, the market will witness additional growth in 2020, owing to the rising adoption of mobile payment solutions. This growth will be majorly driven by changing customer behavior, increasing focus of the people from visiting bank branches to online access of bank services.
With the worldwide spread of COVID-19, the bank operations have been hampered. Borrowers and businesses have faced losses, there has been sluggish growth in sales, and decline in profits. On the other hand, this pandemic has been considered as an opportunity by some to launch digital offerings. Thus, banks have been effectively using the digital tool and providing alternatives to in-person banking and physical exchanges attractively. Our analysts have estimated the condition of the digital banking market during the COVID-19 outbreak and have come to the following conclusions.
|Realtime BPS||*Estimated market Size, 2020,
|**Real Time market Size, 2020,
|9.0%||10.0%||107||USD 947.3 Million||USD 972.2 Million|
* The numbers are estimated prior to the COVID-19 Pandemic in 2020
** The data will vary depending on upcoming developments announced by the operating players
KEY ASPECTS OF THE INDUSTRY
BOOMERS AND DECLINERS
Banks play a vital role for economic growth since their evolution. A bank is a financial institution which deals with monetary deposits, lending, and credits to the customers. In present landscape, banks and businesses are interconnected with each other. The increase in innovation in technologies and development of new solutions encourages banks to transform from traditional bank to e-bank. Rising number of banking institutes are moving toward digital platforms to deliver their services online because of increasing usage of smartphones and increasing internet penetration across the world. Hence, rise in adoption of online and mobile banking platforms are positively impacting the adoption of digital payments for banking, across the globe.
Earlier, the risk of frauds was considerably low, as banks transactions were considered secure due to PIN integrated with online authorization to authenticate the transactions. With increase in innovation in the fintech industry, fraudsters have been coming up with new frauds such as cyber-attacks and skimming, which hamper the market growth. Cyber-attacks are increasing nowadays, and becoming one of the major threats for banks across the globe. In addition, online banking sites and mobile apps are designed to offer security, and banks are continuously updated the sites. However, no system is completely foolproof and can be hacked at any point of time, resulting into risk of identity theft, stolen login credentials, and others.
The COVID-19 pandemic has impacted the digital banking market positively. As per the financial trend suggestions, this time becomes an opportunity for banks and credit unions to understand the expectations of customers from financial institutions. To support and meet the financial needs of the customers, banks have developed business models and now use various technologies such as AI and human resource to impact marketing, innovation and the digital delivery of products and services. This factor is significantly driving the adoption of digital banking and will impel the market growth during the COVID-19 outbreak.
Moreover, increase in acceptance of online banking by consumers and use of online and digital banking substitutes has been increased during this outbreak. For instance, in recent times, a survey reveals that 35% of consumers had increased the use of online banking since the COVID-19 crisis, with 17% stating they have used this facility prior to the pandemic also. At the same time, 30% of consumers have increased their use of mobile banking, with 11% using mobile a lot more. In this way, services and product supply of digital banking will continue business during the COVID-19 pandemic.
MANAGING SUCCESS AMIDST
THE PANDEMIC STRESS
The global digital banking market will witness significant growth in 2020 and is anticipated to follow this trend until the end of the forecast period. The rapid growth is majorly attributed to the increasing penetration of internet and adoption of smartphones across the globe during this pandemic crisis. This market is expected to retain its growth even after the control of the pandemic situation. Moreover, the banks are significantly making continuous improvements in banking technologies to develop enhanced security in transactions.
Based on a recent study, advisers are witnessing surge in demand for cashless transactions from clients, who want low-risk investments that can generate higher returns than traditional cash-based accounts. Digital banking provides convenience and security to the customers and reduces the load and risk of carrying money in hand. These digital cards can be loaded easily and via multiple platforms in various ways including bank account transfers, direct deposit or cash both-online and in person. Furthermore, corporates are also on a constant lookout for cash alternatives to manage their daily transactions. This aspect will drive the growth of the market.
How can we help you?
Our group of skilled analysts provide a solution to help the companies to survive and sustain in this global pandemic. We support companies to make informed decisions based on our findings resulting from the comprehensive study by our qualified team of experts. Our study helps to acquire the following:
- Long-term and Short-term impact of Covid-19 on the market
- Cascading impact of Covid-19 on the Digital Banking Market , due to the impact on its extended ecosystem
- Understanding the market behaviour pre- and post-Covid-19 pandemic
- Strategic suggestions to overcome the negative impact on your business or turn the positive impact into an opportunity