The business banking market to experience strong growth by 2027
Global demand for business banking services has grown significantly in recent years and is expected to increase with the growth of economic activities and the expansion of businesses. Corporate banking is a form of merchant banking that provides a range of financial facilities offered exclusively to businesses, ranging from global conglomerates to medium-sized regional businesses. In addition, treasury services and cash management functions are some of the most popular business banking services that are typically provided by commercial banks. Additionally, companies use these facilities to convert currencies and manage their regular funds and capital expenditures. Business banking provides credit and loan services, commercial real estate services, business valuation, real estate research, equity and debt structuring, etc.
North America (United States and Canada), Europe (Germany, United Kingdom, France and rest of Europe), Asia-Pacific (China, Japan, India and rest of Asia-Pacific), Latin America ( Brazil, Mexico and rest of LATAM) and Middle East and Africa
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The main players analyzed are UBS Group, Bank of America Corporation, JPMorgan Chase & Co., Goldman Sachs Group, Inc., Credit Suisse Group, Deutsche Bank AG, Morgan Stanley, Citigroup Inc., Wells Fargo & Company and DBS Bank.
Main impact factors: analysis of market scenarios, trends, drivers and impact analysis:
Commercial companies are actively engaged in business activities to maintain the financial condition of organizations and these requirements are largely fulfilled by commercial banks. This, as a result, has become one of the driving factors for the growth of the market. However, many companies and organizations prefer reputable banks and financial institutions to smaller financial institutions. Thus, tougher competition from big banks, disruptions in FinTechs facilitating alternative sources, and a highly regulated environment are hampering market growth.
Conversely, the Asia-Pacific region is experiencing growing economic activities, commercial expansions more than developed markets. These emerging countries have become a target segment for large corporations and thus create lucrative opportunities for the corporate banking sector in the region.
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The global business banking market trends are as follows:
Adoption of disruptive technologies:
The disruptions in FinTech and artificial intelligence are having a huge impact on customers and their ties to the banking industry, as consumers demand faster services and instant payment offers. So, in order to overcome these needs and challenges, banks are partnering with fintech companies and implementing integrated technologies such as artificial intelligence and blockchain technologies in core banking systems. For example, HSBC Bank, which is a large corporate banking institution, is effectively focusing on digitizing a number of its existing services as it seeks to strengthen its underlying customer experience. Additionally, merchant banks use optical character recognition (OCR) tools to read PDFs and instantly transmit data to front-end systems, increasing productivity, minimizing errors and improving user experience.
Integration of ESG risk factors in investment decisions:
Environment, Social and Governance (ESG) refer to the three key criteria for measuring the sustainability and socio-economic impact of a business and business investment. Such metrics help to more easily assess the potential financial results of the business. The main goal of integrating ESG risk factors is to execute environmental and climate disruption and improve the business model of companies with a low impact environment. In addition, with a lower effect on the environment per company, the financing will be implemented at lower interest rates. Additionally, regulators such as the European Union, Financial Stability Board restrictions on investment banks based in Europe have prompted banks to incorporate ESG factors into their business operations.
Analysis of the COVID-19 scenario:
- The pandemic is severely impacting the banking sector with an increase in bad debts, credit and collection restrictions, moratoriums and more. Thus, several commercial banks have seen an increase in digital transactions which are widely preferred by businesses.
- Disruptions in the corporate value chain have led investment banks to re-evaluate their banking business models.
- Additionally, commercial banks have witnessed a higher flow of credit approval applications from small and medium-sized businesses.
- However, the huge demand for new or rebalanced regulations on business credit has put greater pressure on banks’ lending operations in the market.
Main advantages of the report:
- This study presents the analytical description of the global commercial banking services market along with current trends and future estimates to determine impending pockets of investment.
- The report presents information related to key drivers, restraints, and opportunities along with detailed analysis of the global commercial banking services market share.
- The current market is quantitatively analyzed from 2020 to 2027 to highlight the growth scenario of the global commercial banking services market.
- Porter’s Five Forces Analysis illustrates the power of buyers and suppliers in the marketplace.
- The report provides detailed market analysis based on the current and future competitive intensity of the market.
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Questions Answered in the Commercial Banking Services Market Research Report:
- Who are the main market players active in the corporate banking market?
- What would be the detailed impact of COVID-19 on the global business banking market?
- What current trends would influence the market in the coming years?
- What are driving factors, restraints, and opportunities in the global commercial banking services market?
- What are the projections for the future that could help take further strategic action?
Key segments covered:
- Company and salary accounts
- Credit and loan services
- Cash management services
- Short-term funding
- Large companies
- Small and medium enterprises