PwC: Traditional banks could fade away

Retail

The market economy of 2025 could possibly operate without the presence of “traditional” banks, according to a PwC report published today and entitled “The Future Shape of Banking”.

The report suggests that as barriers that prevent non-banks from providing "core" banking services continue to drop away, the business models of today’s banks will be challenged. Nonetheless, the report says, banks retain some substantial advantages that counter the current. Trust and brand matter in financial transactions, and some of the resistance to alternative banking providers results from a lack of trust in their security, the report says.

Eventually, according to PwC’s experts, fundamental change is inevitable. The only question is how much of banks’ traditional territory the new entrants will occupy.

Key points from the report:

  • • Banking services will move away from physical, tangible distribution into technology-enabled channels.
  • • As technology advances, it will become easier for customers to move between banks and other service providers.
  • • Brands could become central to banks’ value – those which build a brand which represents trust, integrity, security and quality to customers will be more likely to solve the ‘transaction cost’ of choosing how and with whom to bank.
  • • Banks could become utilities focused on the management of deposits below insured limits and providing a narrow range of domestic credit products.
  • • Regulators and regulation also need to adapt their mindset and approach in order to deal with the changing banking landscape.
E.ON Survey Shows Support for Renewables, Need for Innovativ... Green Energy

E.ON Survey Shows Support for Renewables, Need for Innovativ...

Hungary in Talks on Attracting More Chinese Investments - Sz... Int’l Relations

Hungary in Talks on Attracting More Chinese Investments - Sz...

Close to 2,500 Companies Apply for EV Subsidies Automotive

Close to 2,500 Companies Apply for EV Subsidies

Olympic Fest of Street Sports in Budapest Coming This June In Budapest

Olympic Fest of Street Sports in Budapest Coming This June

SUPPORT THE BUDAPEST BUSINESS JOURNAL

Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.