Market Insights Financial Banking Traditional Banks

Traditional Retail Banking - Japan

Japan

In Japan, the Traditional Retail Banking market market is expected to witness a significant increase in Net Interest Income, reaching a projected value of €8.16bn by 2024.
Looking ahead, this segment is anticipated to exhibit a compound annual growth rate (CAGR 2024-2029) of 9.66%, leading to a market volume of €12.94bn by 2029.
When compared globally, it is worth noting that China is projected to generate the highest Net Interest Income, with a value of €2,249.0bn in 2024.
In Japan, traditional retail banking is still highly valued, with a focus on in-person interactions and personalized service.

Key regions: France, Brazil, Germany, United Kingdom, United States

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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Moneda

Analyst Opinion

The Traditional Retail Banking market in Japan is experiencing a shift in customer preferences, trends, and local special circumstances that are shaping its development.

Customer preferences: Customers in Japan are increasingly seeking convenience and efficiency in their banking services, leading to a growing demand for digital banking solutions. With the advancement of technology and the rise of fintech companies, customers are looking for seamless online and mobile banking experiences that offer flexibility and accessibility.

Trends in the market: One prominent trend in the Traditional Retail Banking market in Japan is the integration of artificial intelligence and automation to streamline processes and enhance customer service. Banks are investing in AI-powered chatbots, personalized recommendations, and automated services to cater to the evolving needs of tech-savvy consumers. Additionally, there is a growing trend towards personalized banking services that are tailored to individual customer preferences and behaviors.

Local special circumstances: Japan's aging population presents a unique challenge and opportunity for the Traditional Retail Banking market. With a significant portion of the population being older, banks are focusing on developing products and services that cater to the specific needs of seniors. This includes user-friendly interfaces, financial planning tools, and specialized customer support to address the concerns of an aging customer base.

Underlying macroeconomic factors: The economic landscape in Japan, characterized by low interest rates and slow economic growth, is influencing the Traditional Retail Banking market. Banks are exploring new revenue streams and cost-cutting measures to maintain profitability in a challenging environment. Additionally, regulatory changes and government initiatives aimed at promoting financial inclusion and innovation are shaping the market dynamics and driving competition among traditional banks and new entrants.

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.