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The US retail banking market size is forecast to increase by USD 91.47 billion, at a CAGR of 4.35% between 2023 and 2028. The growth of the market depends on several factors, such as the ongoing digital transformation in retail banking, the growing collaboration with fintech companies, and the increasing focus on financial inclusion. The report provides market size, historical data spanning from 2018-2022, and future projections, all presented in terms of value in USD billion for each of the mentioned segments.
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Our researchers analyzed the data with 2023 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
Ongoing digital transformation is the key factor driving market growth. Digital transformation enables retail banks to offer seamless and user-friendly online and mobile banking experiences. With features such as 24/7 account access, real-time transaction tracking, and user-friendly interfaces, customers benefit from enhanced convenience and accessibility, fostering loyalty and attracting new clientele. Banks are continuously investing in digital technologies to attract new consumers.
Additionally, digital advancements can implement robust cybersecurity measures and ensure compliance with evolving regulatory requirements. Enhanced security features, such as biometric authentication and encryption technologies, instill confidence in customers, addressing concerns regarding cyber threats and fostering a secure digital banking environment. Thus, such factors continue to invest in digital technologies, which will foster market expansion during the forecast period.
The growing adoption of cloud-based retail banking solutions is the primary trend shaping the market. Cloud-based solutions provide the flexibility to scale their operations seamlessly. As customer demands evolve, cloud infrastructure allows to adapt swiftly by adjusting resources, introducing new services, and optimizing operations. Cloud eliminates the need for expensive on-premises hardware and IT staff, leading to cost savings and optimized resource allocation. Cloud providers offer robust security features and expertise in handling sensitive financial data, ensuring regulatory compliance and data protection. Cloud computing eliminates the need for extensive physical infrastructure, reducing the costs associated with maintaining and upgrading traditional IT systems.
Additionally, cloud service providers invest heavily in advanced security protocols, often surpassing the capabilities of individuals. This ensures robust data protection, compliance with regulatory standards, and a heightened level of cybersecurity. One of the largest banks in the US, JPMorgan Chase, has been actively migrating its applications to the cloud to improve agility and innovation while optimizing costs. Similarly, Bank of America has been leveraging cloud services to enhance its digital capabilities, offering customers a more seamless and efficient banking experience. Hence, the growing adoption of cloud-based solutions in the US will drive the growth of the market in focus during the forecast period.
Rising cybersecurity threats is a challenge that affects market growth. Cybersecurity breaches, leading to the unauthorized access of customer data, erode trust. As customers become increasingly concerned about the safety of their financial information, trust issues can hinder the acquisition of new customers and lead to attrition among existing ones. Successful cyberattacks can result in financial losses for both banks and their customers. The costs associated with recovering from a breach, compensating affected customers, and implementing enhanced security measures can strain a bank's financial resources and disrupt its normal operations.
Additionally, they heavily rely on digital technologies to provide seamless and innovative services. Persistent cybersecurity threats can impede digital transformation initiatives as may need to divert resources from innovation to fortify their cybersecurity infrastructure, slowing down the pace of technological advancements. Ransomware attacks, where cybercriminals encrypt critical data and demand payment for its release, can lead to operational downtime. As cyber threats continue to evolve, they will negatively impact the development of the market in focus during the forecast period.
The market forecasting report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth analysis strategies.
Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
The market research and growth report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The private sector banks segment is estimated to witness significant gains during the forecast period. The segment in the US retail banking market has witnessed growth due to several factors. Some private banks operating in the US include JPMorgan Chase Private Bank, Bank of America Private Bank, Wells Fargo Private Bank, and Citibank Private Bank. Additionally, advancements in financial technology have lowered the barriers to entry, allowing US to leverage innovative solutions and provide services that cater to evolving customer needs. Further, they are also expanding the number of its financial centers to add more customers and increase its share in the retail banking market in US.
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The private sector banks segment was the largest segment and was valued at USD 98.51 billion in 2018. Furthermore, the growing popularity of private banks in the US can be attributed to their focus on customer-centric approaches and personalized services. Additionally, exceptional services provided by private sector banks in the US include high-net-worth client management, customized financial planning, and a suite of wealth management products. Consequently, the increasing number of private banks across the US, the adoption of technological advancements in retail banking, and a growing demand for personalized and exclusive financial services will drive the growth of the private sector banks segment in the retail banking market in US during the forecast period.
The market report forecasts market growth by revenue and provides an analysis of the latest trends and growth opportunities from 2018 to 2028.
The market is influenced by various factors, including household debt levels, domestic consumption, and credit card balances outstanding. Despite challenges posed by fluctuating disposable income and lockdown restrictions, retail banks have adapted by enhancing their digital front to compete with emerging tech competitors and fintechs. This includes the integration of fintech APIs and collaboration with online banks to improve customer experience while ensuring personal data security and privacy in compliance with regulatory mandates.
With the rise of Gen Z consumers, who prioritize convenience and accessibility, retail banks are exploring innovative solutions such as real-time payments and cryptocurrencies. Partnerships with platforms like WeChat and Ant Financial are expanding access to financial services, while initiatives like open banking foster collaboration and innovation across the industry. As the landscape evolves, retail banks must balance fee income and spending with non-performing loan ratios to sustain growth and profitability in a dynamic market, aligning with the principles set forth by the World Bank.
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US Retail Banking Market Scope |
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Report Coverage |
Details |
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Page number |
163 |
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Base year |
2023 |
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Historic period |
2018-2022 |
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Forecast period |
2024-2028 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 4.35% |
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Market growth 2024-2028 |
USD 91.47 billion |
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Market structure |
Fragmented |
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YoY growth 2023-2024(%) |
3.72 |
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Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
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Key companies profiled |
Bank of America Corp., Bank of Montreal, Barclays PLC, BNP Paribas SA, Capital One Financial Corp., China Construction Bank Corp., Citigroup Inc., Deutsche Bank AG, HSBC Holdings Plc, Industrial and Commercial Bank of China Co., JPMorgan Chase and Co., Key Corp., Mitsubishi UFJ Financial Group Inc., Regions Financial Corp., The Charles Schwab Corp., The PNC Financial Services Group Inc., The Toronto Dominion Bank, Truist Financial Corp., U.S. Bancorp, and Wells Fargo and Co. |
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Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and market condition analysis for the forecast period. |
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Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements.
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Type
7 Market Segmentation by Service
8 Market Segmentation by Channel
9 Customer Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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