Latest Retail banking reports and research: Finextra Research

Future of Report

The Future of Digital Banking in North America 2024

2023 was characterised by increasing amounts of uncertainty and a lack of clarity across the financial world. The collapse of banks, including Silicon Valley Bank, Signature Bank and First Republican Bank, in March 2023, added strain to already unsettled financial markets. While market volatility has remained relatively stable, soaring inflation and climbing interest rates slowed economic growth and this is expected to continue into 2024. While forecasts regarding the length and severity of a possible recession are speculative, experts are even more divided about stock market predictions for 2024. Optimism is strong in many investors who expect that 2024 is the year rates will stop rising and predict bullish turns that will see markets soar to new heights. Yet with many other factors affecting North American markets, the only certainty we can expect as we look towards 2024 is more uncertainty. This Finextra report on the outlook of North American banking trends, is produced in association with Money20/20 and includes key insights and commentary from industry experts at EY and Mastercard.

23 October 2023 741 downloads

Future of Report

The Future of Fintech in Latin America 2023

Many companies, countries and regions have forged ahead in leveraging data, cloud, blockchain and AI. One such region is Latin America, where according to Statista, there are 2,300 registered fintech companies, operating across payments, remittances and lending. Latin America is a region with undoubtedly high user penetration across the internet and associated services, but obstacles to financial inclusion remain and prevent individuals from being banked or served by their financial services providers. What this means is that Latin America is ripe for fintech companies to leverage this opportunity and offer a solution to this substantial, yet online, population. However, some progress has been made. Organisations in Brazil and Mexico saw a staggering $6 billion in investments into fintech companies in 2021. Further to this, in Brazil, the number of finance app downloads increased by 274% from 2019 – 2022 and in Mexico, the number of downloads more than tripled. Paraguay, however, is the country with the highest share of adult population using mobile money services. Digital payments is the area of fintech that is most widely used, accounting for nearly eight in 10 users in 2022. Personal finance, neobanking, and alternative lending are also present within Latin America, with Nubank as a clear success as the largest digital bank in Latin America and one of the largest in the world with 1.34 million. When Latin America leverages technologies such as AI, blockchain, cloud and data, the region will become one of the world’s leaders in fintech and grow across the digital banking, digital payments, personal finance, lending, and investment sectors. This report, in association with NovoPayment, compiles expert insights from a range of firms, including: BBVA, Kueski, PagBank PagSeguro, provides predictions for the future of fintech in Latin America.

09 August 2023 313 downloads

Future of Report

The Future of Fintech in Africa 2023

Across fintech - digital banking, digital payments, personal finance, lending, and investment - data is central to the function of all these technologies and the most important source for the analysis of financial products and services, bridging the gap between data security and customer satisfaction. Many organisations, countries and regions have forged ahead in leveraging data, cloud, blockchain and AI to their advantage – one such continent is Africa. Two years after the global financial crisis, Kenyan payments, money transfer and micro-financing service M-Pesa became the most successful mobile phone based financial service in the developing world. This was also just three years after its launch by network operators Vodafone and Safaricom. Further to this, transaction flows sent by banks have grown by an average of 10% year-on-year during this 10-year period. Alongside this, mobile money payments have exploded, with the monthly value of transactions increasing 25 times over between 2010 and 2018. The digital payments market has matured faster in Africa than it has in Europe: the number of electronic payments in France grew from 33 million in 2009 to 61.5 million in 2018, but in Nigeria, the number of electronic payment transactions grew from 66 million in 2008 to over two billion in 2018, according to Statista. Further to this, the number of digital payments users is slated to amount to a staggering 611 million users by 2027. However, Africa’s largest market will be digital investment with a total transaction value of $994 million in 2023 and the digital assets market is expected to show a revenue growth of 36% in 2024. It is evident that Africa is on the rise and leveraging technologies such as AI, blockchain, cloud, and data will only allow the continent’s fintech firms to excel across the digital banking, digital payments, personal finance, lending, and investment sectors. This Finextra report, produced in association with Kora, compiles expert insights from a range of firms, including: Binance, Cloud Africa, Data Scientists Network, JUMO, Mojaloop Foundation, TymeBank, and Yoco, and provides predictions for the future of fintech in Africa.

20 July 2023 577 downloads

Event Report

How to Formulate an Actionable Cloud Strategy

A Financial Cloud Series Report. Discover the power of the cloud with our comprehensive event report on formulating an actionable cloud strategy. As part of the Financial Cloud Series, Finextra explores the transformative potential of the cloud for the financial and technology industries. Gain insights from industry experts as they discuss how banks are accelerating digital transformation, leveraging the cloud's capacity and scalability, and setting themselves up for success on their cloud journey. Learn about striking the right balance between in-house technology and outsourcing, managing cost-effectiveness and transparency, and navigating hybrid cloud strategies. With an actionable cloud strategy, your organization can unlock innovation, agility, and growth in the digital era. Get your copy now and embark on your cloud journey with confidence. Watch the Finextra Financial Cloud Series webinar - How to Formulate and Actionable Cloud Strategy - on which this report is based. If you would like to get involved in our Financial Cloud Series conference on 7th March 2024 in London, please email us at events@finextra.com

13 July 2023 213 downloads

Survey

Payments Modernisation: The Big Survey 2023

Embracing payments modernisation in a dynamic landscape. Building on the previous 2021 and 2022 industry surveys, the latest 2023 edition captures and examines ongoing priorities within payments modernisation, with a particular focus on the growth or need for partnerships and cloud-facilitated account-to-account (A2A) payment applications and payments-as-a-service (PaaS) offerings. The report analysis will provide a comprehensive overview of the status and adoption of real-time payment networks within domestic markets and increasingly through intra-regional schemes and cross-border networks globally. The background context of shifting regulatory requirements and nonmandated initiatives alongside standards development will give colour and add depth to the state of adoption and implementation one more year on, giving a clear status check and trajectory of the overriding trends and attitudes in the space. Download your copy of this Finextra Survey Report, produced in association with Volante Technologies, to explore further.

07 July 2023 1391 downloads

Future of Report

The Future of Digital Banking in Europe 2023

A Money20/20 Europe Special Edition Growth across the European fintech industry is fluctuating, and it is becoming increasingly evident that the record levels of funding and deals seen in 2021 will not happen again any time soon. As revealed by CB Insights, funding rose by a staggering 168% to reach $131.5 billion in 2021 from $49 billion in 2020 after fintech firms the likes of Klarna and Stripe achieving monumental valuations. However, 2022 saw rising interest rates, a cost-ofliving crisis and continued geopolitical instability which led to trillions in valuation being erased from public markets. Europe’s fintech sector remains at the core of the financial services industry, rather than at the fringes as it was once before. According to McKinsey, in each of the seven largest European economies measured by GDP – France, Germany, Italy, the Netherlands, Spain, Switzerland and the UK – at least one fintech firm ranks among the top five banking institutions. This Finextra report, a Special Edition for Money 20/20 Europe, collates interviews with a range of leading players across the financial services and fintech industries operating across Europe and explores topics that will be covered at the event in Amsterdam. It features key insights from Accenture, ClearScore, Deutsche Bank, ING, Nium, Plum, Ripple, Société Générale, Tink, Visa, and Zopa that will discuss how digital banking across the continent will evolve.

05 June 2023 1009 downloads

Report

Embracing Technology to shape the Future of Digital Banking

There has been a tidal wave of transformation - the pace of it is accelerating, technology is proliferating, and customer behaviour and expectation are advancing all the time; the banking industry is in flux and it is a challenging time but also an exciting one. To successfully navigate this evolving landscape, financial institutions must stay attuned to the changing needs and preferences of customers and embrace emerging technologies to adapt and rethink their existing business models. There are a few business models that have been developed and discussed over the years. Open banking has ushered in new platforms as well, acting as aggregators of banking services and connecting different players in the ecosystem. Given the trajectory in the last couple of years, with digitalisation efforts in banking services having been accelerated by the pandemic, there will be yet more banking models to form. The digital experience can be much developed; new platforms, marketplaces and ecosystems will undoubtedly be created, and payment methods, which ultimately underpin financial services and commerce, are likely to undergo further evolution too. Download your copy of this Finextra whitepaper, produced in association with Worldline, which explores the current landscape of models and what factors may influence further evolution.

20 April 2023 603 downloads

Report

The Future of Fintech in the UK 2023

A Special Edition for UK Fintech Week 2023 and IFGS 2023 Fintech investment across Europe, the Middle East and Africa fell from $79 billion across 2,379 deals in 2021 to $44.9 billion across 1,977 deals in 2022, according to KPMG’s biannual analysis of global fintech investment, the ‘Pulse of Fintech’ report. Further, total UK fintech investment hit $17.4 billion in 2022, down from $39.1 in 2021. The first half of last year was much stronger than the second, accounting for $32.8 billion in investment, including six deals worth over $1 billion, which includes the $1.8 billion acquisition of interactive investor by abrdn. The latter half of 2022 also saw $12 billion in investment, with the largest deals all valued under $1 billion, including the $839 million buyout of Nucleus Financial by HPS Investment Partners. But what does the future hold for fintech investment in the UK in 2023? This Finextra report, a special edition for Innovate Finance Global Summit and UK Fintech Week 2023, collates interviews with a number of leading fintech firms operating in the UK and explores topics that will be covered at the event in London. Key insights from the likes of Archie, Creditspring, Harrington Starr, Konsentus, KPMG, Moneyfarm, Nova Credit, OakNorth, Open Banking Excellence, Ozone API, Pave, Pollinate, PPRO, Quantexa, Sonovate, Thought Machine, Truelayer, and Zopa, cover how fintech firms across the UK are preparing for the future.

13 April 2023 687 downloads

Report

UK Open Banking API Performance 2021-2022

The UK continues to be at the forefront of the global Open Banking revolution thanks to the proactive attitude of the regulators. These regulators helped create an Open Banking ecosystem that encourages and facilitates smaller banks and new entries, including fintechs and neobanks, to participate in the Open Banking market. As the most advanced Open Banking market in the world, the UK provides an example of best practices in the implementation of API-based Open Banking. We studied the performance of the large CMA9 UK banks, traditional High Street banks, credit card providers and building societies, and new entrant banks (neobanks). The endpoints were provided by the banks and measured using our patented APImetrics quality scoring system, CASC (Cloud API Service Consistency). Download your copy of this research report by APImetrics, which is generated from real API calls made using the FAPI compliant consent process with the partnership of tomato pay, a leading open banking provider in the UK. All calls were made between July 1, 2021 and June 30, 2022.

26 October 2022 422 downloads

Report

The Future of Digital Banking in North America 2023

A Money20/20 USA Special Edition 2022 in North America saw a continuation of economic recovery from the Covid-19 pandemic, fuelled by the rapid rollout of vaccinations particularly across the US and Canada. Although the US was the fastest of the G7 economies to recover from the crisis, an enduring impact of the Russia-Ukraine conflict resulted in high inflation and the subsequent cost-of-living crisis is set to continue into 2023. These macrotrends are a catalyst for digital transformation within the financial services industry as banks attempt to grapple with new payments trends, the evolution of digital identity and innovative uses of data to enhance customer experience across retail, wholesale and commercial relationships. In 2022, digital banking for the consumer is far more advanced than the products and services that are available for merchants or large corporations. In 2023, open banking must be utilised to remedy this issue. For the retail customer, although digital methods of managing money are now part and parcel of day-to-day life, the pandemic encouraged, or in some cases, forced people who may have been uncomfortable with using technology to bank on their mobile phones or desktop computers. This unfamiliarity with technology has led to consumers being in environments in which they are vulnerable and at increased risk of fraud and other types of financial crime. In 2023, banks will need to ascertain what they need to adapt and strengthen in fraud prevention while also managing new regulatory and compliance requirements. Further, the areas of onboarding that need to be automated must also be considered as part of a holistic digital strategy, striking the balance between innovation and digital noise. For instance, Web3, the metaverse, digital assets and tokenisation are no longer the monopoly of global tech giants, but are increasingly being shaped by financial players who are having their relevance threatened. This Finextra report, which features expert views from ebankIT, EPAM Systems, Infosys Finacle, and Trustly, will explore topics that impact the digital banking sector and those that will be covered at Money20/20 USA 2022 in Las Vegas. Additionally, key insights from Wells Fargo, Plaid, Green Dot, Silicon Valley Bank, FXC Intelligence, Synapse, Navy Federal Credit Union, Branch, Citi, and the New York State Department of Financial Services will cover how organisations across North America are preparing for imminent change across the digital banking landscape.

21 October 2022 1154 downloads

Report

Banking as a Service: Predictions for 2023

Cloud strategies are changing After the financial crisis of 2008, traditional lenders experienced a drop in revenue and new players successfully gained traction after offering products that had been in high demand and long expected from existing banks. This trend advanced after regulators across the world endorsed open banking initiatives, data requirements were standardised and in turn, financial players gradually opened up to technology. With the transparency that open banking provides, banks were encouraged to offer digital services, fair pricing, and increased security. Further, they are forced to utilise application programming interfaces (APIs) for seamless information exchange between partners. This trend has since evolved: with open finance, APIs can facilitate the interchange of data, products and services in an attempt to improve customer experience, offer greater choice, and control over their finances. In 2020, the financial services industry - particularly banks - implemented emerging technologies to accelerate innovation across the infrastructure of core functions in real-time, and underlying trends that were previously being considered were utilised in weeks, rather than months or years. The coronavirus has led to relationships with consumers being reimagined and relationships with ecosystem partners being redefined; this also resulted in products and services being reconsidered. Technology providers are no longer just technology vendors: startups, scaleups and even unicorns are now viable collaborators for financial institutions. In this post-lockdown era, banks are tapping into this partnership model to enhance their digital transformation to keep pace with customer requirements and avoid being disrupted by newer, more technology-savvy, entrants. When banks work with technology companies, APIs can be built with a number of microservices that can communicate and connect with these third parties, building upon open finance solutions on cloud-based platforms. This allows financial institutions to scale on demand, pay for only what is consumed, and expand serverless architectures. Financial institutions are no longer considering the cloud – the cloud is necessary for how finance works today. An emerging yet burgeoning trend that will continue to evolve and grow in 2023 – banking as a service (BaaS) - offers a new route to market for banks and empowers them to attract new, niche customers by leveraging the cloud. BaaS also allows non-financial companies to push out financial products where and when they are needed, direct to their customers with minimal investment and with the benefit of cloud-based, pay-as-you-go pricing. This Finextra impact study, produced in association with i-exceed, explores how financial institutions and technology providers can collaborate to deploy mobile and web-based banking solutions at a faster rate.

20 October 2022 1004 downloads

Report

SaaS: The case for building a new banking business model

Why is SaaS pivotal to tackling regulatory, competition, and technology challenges? Banks are no longer only interested in building their infrastructure in order to serve their customers the best they can. Rather, they strive to position themselves as the orchestrators of API platforms. Software as a Service (SaaS) deployment models are the ideal tool to reduce the struggles faced by banks as their role evolves. SaaS models are highly effective, as they target some of the key challenges banks face in their efforts to digitally evolve while remaining competitive. An increasingly demanding customer base, competition from agile digital players, regulatory burdens and legacy technology are four of these significant hurdles that can be mitigated using SaaS. Not only does SaaS assist in managing these challenges, it can also equip financial institutions with the toolkit required to thrive in the future. This Finextra impact study, produced in association with Temenos, explores how banks can best leverage technologies by third-party providers in order to mitigate industry pressures threatening their business model, adapt to shifts in customers' interaction behaviour, and improve their ability to remain competitive in an increasingly digital ecosystem.

03 October 2022 519 downloads

Report

Onboarding, KYC, and Digital Identity: the Bottom Line

Technology is continuing to evolve at a fast rate. Consumers have evolved and now expect a digital onboarding process. This presents an opportunity for banks because enhanced customer onboarding can boost a bank’s retention rate. It is the first interaction that a customer, instead of a prospect, experiences and if conducted correctly, it can lead to multiple purchases and build customer loyalty. Regardless of how seamless the process is for a customer to be onboarded, it is only revenue that will result in a return in investment. While automation can supplement an excellent customer experience, nation-wide digital identity schemes can also improve the process. Across the world, governments have played an important role in helping set the scene for digital ID solutions, but a government-only solution is unlikely to be successful. Banks, fintech firms and technology providers must collaborate to ensure identity solutions are utilised. However, while customers want an easy onboarding process, organisations must capture, validate, and monitor customer identities — without increasing customer friction. Taking collaboration further, within the organisation, digital transformation, risk management, data security, and compliance teams must put best practices in place to balance digital onboarding with fraud prevention. This Finextra impact study, produced in association with VeriPark, explores how despite the emergence of digital channels, onboarding is still occurring in a fragmented manner.

10 August 2022 810 downloads

Report

Rebundling: The Next Stage of the Fintech Evolution

The next stage of the fintech evolution is rebundling. At the core of the industry, the catalyst for fintech evolution has continued to be disruption and innovation, but not one banking or financial services issue can simply be resolved with only disruption or innovation. After the global financial crisis of 2008, it would have been unusual to have more than one or two banking relationships. However, the emergence of an open playing field, and with the application of the Second Payment Services Directive – more commonly known as PSD2 – across Europe, non-financial businesses were able to leverage open banking and open finance initiatives to offer financial services directly to their customers. This, in turn, widened the competition and resulted in the birth of fintech businesses that each focused on attacking one part of the banking value chain – be it payments, lending, FX, or another type of offering. Slow, complex, and expensive processes were no longer the status quo; and alternative players started to disintermediate the incumbents. These new entrants increasingly became popular because of their intention to improve customer experience and provide better products and services than the banks could – and in many cases, disruptors were both better and cheaper than the banks. Additionally, new fintech channels and platforms have become viable competitors to traditional players, tempting consumers away from the institutions they trust in favour of better user experiences. Now it is not unusual for people to have up to 15 financial apps downloaded on to their mobile phones. This Finextra impact study, produced in association with Banking Circle Group, explores the evolution of fintechs and Big Techs from unbundling towards rebundling of financial products and services to the benefit of customers, as well as providing examples for the modernisation of banks and financial institutions.

22 July 2022 791 downloads

Report

The Future of Digital Banking in the UK 2022

The digital transformation of financial services remains a defining journey being undertaken by banks and fintechs across the globe. Increased digitisation of banking services after the Covid-19 pandemic, demonstrates how financial institutions are becoming more agile and better equipped to serve their end-customer. The future of banking is an industry reliant on cloud-based technology and partnerships with fintechs to drive their businesses forward. The digitisation of financial services through mobile apps, audio chatbots, and automation makes banking more personalised and convenient to users. However, accompanying this digitisation comes challenges such as cybersecurity and fraud, arising from this shift toward a digital ecosystem. Talent has never been in higher demand, and retaining strong employees with the right training is pivotal to succeeding digitally. By partnering with fintechs, banks are overcoming these challenges and navigating the new environment with the future front-of-mind. Featuring expert views from 10x Banking, Infosys Finacle, Mambu, and Salt Edge, and insights from Lloyds, first direct, OakNorth, and Santander, this Finextra report will explore how industry leaders perceive key events and trends defining the future of digital banking in the UK, during 2022 and beyond.

07 July 2022 1386 downloads