The UK Retail Banking Market size was valued at USD 42.56 Billion in 2022 and is expected to surpass USD 47.64 Billion by 2031, expanding at a CAGR of 1.26% during the forecast period, 2023 – 2031. Retail banking, often known as consumer banking, refers to range of services a bank provides to individual customers.
Savings and checking accounts, mortgages, personal loans, and debit/credit cards are among the key services provided by retail banks. The retail banking industry in the UK is being pushed by enormous forces, which are necessitating transformation.
Banks are becoming digitally enabled and API-driven, relieving teams of antiquated technology and time-consuming processes as automated solutions have grown to streamline of the lengthy processes. However, the wide adoption of advanced technology in banking such as using AI to utilise large data and provide personalised services to clients presents a key aspect of the market development.
The technology imparts a key function that, after gathering data from many sources, it can assess customer profiles, online data, and past interactions to deliver product recommendations and other personalised ideas. This is a key factor creating market growth potential.
Retail Banking Market Trends, Drivers, Restraints, and Opportunities
Customer expectations, new competitors, demography change, and shifting economics are key factors driving the market growth.
Growing use of electronic devices such as laptops and smartphones along with the rising growth of the Internet connectivity that allow easy access to banking system present key driving factors of the market.
Uncertainty caused by Brexit and its economic impact due to the growth of total loan balances outstanding of the country is a major challenge that can impede the market expansion in the future years.
Favorable policies of the Government of the UK on personal loan along with provision of low interest rates of loans and better payment terms offered by companies are creating new opportunities of the market expansion.
Increasing banks' subsidiary and other financial advantages to improve the lifestyle of people along with fulfilling their aspirations through affordable credit acts as a key factor driving the market growth.
Scope of Retail Banking Market Report
The report on the UK retail banking market includes an assessment of the market, size, share, trends, segments, and regional markets. Overview and dynamics have been included in the report.
Retail Banking Market - UK Industry Analysis, Growth, Share, Size, Trends, and Forecast
2016 - 2021
Products (Transactional Accounts, Savings Accounts, Debit Cards, Credit Cards, Loans, and Others), Channels (Direct Sales and Distributor)
Market Scope, Analysis, Share, Competitive Analysis, Growth Facts, Restraints, Opportunities, and Revenue Forecast
Key Players Covered
Lloyds Banking Group; Barclays; HSBC; Royal Bank of Scotland; Standard Chartered PLC; and Tesco Bank
UK Retail Banking Market Segment Insights
Credit cards segment is expected to register a robust CAGR
In terms of products, the UK retail banking market is divided into transactional accounts, savings accounts, debit cards, credit cards, loans, and others. The credit cards segment is expected to register a robust CAGR during the forecast period owing to rising number of working population and their growing acceptance of credit cards. Moreover, wide provision of easy accessibility and favorable policies of credit cards offered by various banking organizations are further pushing to accelerate the segment growth.
On the other hand, the loans segment is projected to account for large market share in the coming years owing to wide provision of low-interest loans and easy access to various loans from retail banking sectors.
Direct sales segment held substantial market share
Based on channels, the market is bifurcated into direct sales and distributor. The direct sales segment held a substantial market share in 2020 and is anticipated to register a high CAGR during the projected period owing to wide adoption of robotic process automation, which makes bots intelligent of the process.
However, the distributors segment is projected to hold a key market share in the coming years owing to the presence of several distributor agents that can easily reach and connect a large number of customers. Moreover, the service of door-step assistance from distributors acts as a key factor driving the segment growth at a significant pace.
- Transactional Accounts
- Savings Accounts
- Debit Cards
- Credit Cards
Key players competing in the UK retail banking market are Lloyds Banking Group; Barclays; HSBC; Royal Bank of Scotland; Standard Chartered PLC; and Tesco Bank.
These players are actively engaged in various market development strategies such as mergers & acquisitions, collaborations, agreements, and partnerships to strengthen their geographical presence.