Digital banking users to reach nearly 3 billion by 2021: Study

NEW DELHI: New research from leading fintech analysts, Juniper Research forecasts that, by 2021, nearly 3 billion users will access retail banking services via smartphones, tablets, PCs and smartwatches, up 53% from this year.

The research finds that usage will continue to rise as consumers increasingly opt for banks offering the convenience of rapid, multi-channel digital services. This means that banks will need to focus on providing a more frictionless digital experience to their customers, especially if they are to remain market leaders.

Tech-Innovation Drives Digital Transformation

The new research, Retail Banking: Digital Transformation & Disruptor Opportunities 2017-2021, found that while traditional banks have so far remained a step behind in delivering innovation and maintaining their competitive edge against new fintech players, the situation is gradually changing.

“Technology is currently the big differentiator for all types of banks; including traditional banks and the so-called challenger banks. Investments in banking technology reached record levels in 2016 and traditional banks are expected to focus on digital transformation initiatives”, added research author Nitin Bhas.

Juniper predicts that in 2017, big banks will acquire challenger players including tech-startups and digital-only banks, and this will further accelerate the rollout of traditional players’ digital strategy.

Digital Transformation Readiness Index

Juniper's ‘Digital Transformation in Banking Readiness Index’ analysed leading global tier-1 banks to evaluate their digital transformation readiness scores and highlight their respective positioning within the digital innovation roadmap.

It identified the leading banks for digital transformation in the sector:

Banco Santander
Bank of America
Barclays
BBVA
BNP Paribas
Citi
HSBC
JP Morgan Chase
RBS
Société Générale
UniCredit
Wells Fargo

These banks scored highly and were found to be progressing rapidly towards the final stages of digital transformation. These players have invested heavily in technology, have excellent digital portfolios, and are already witnessing significant cost savings.