Banking Outlook 2024 - Trends to watch out for

The year 2023 was a tumultuous one, marked with multiple bank failures, uncertainty due to the wars and overall economic landscape. There are new opportunities being explored thanks to breakthroughs in technology led on by ChatGPT.

The banking sector that showcased resilience in the face of tough environments is bracing itself for an economic outlook of moderate inflation, slow economic growth, high interest rates and greater regulatory pressure.

Industry experts are predicting high interest rates persisting into 2024 in most key global markets, including the US. Banks will continue to benefit from high interest rate and wider net interest margins and revenue flows until margins begin to narrow mildly late in 2024.

However, regulatory pressures, new rules and compliance timelines will persist banks to be on their toes for managing capital adequacy, data privacy and corporate sustainability while technological advances will lure banks to invest and explore for future readiness.

Key Themes and trends which will be in effect during 2024

• Customer Centricity - Which covers Hyper-personalization, Proactive enegagement, Digital Onboarding
• Payments Modernization - which covers FedNow adoption, ISO 20022 migration, Variable Recurring Payments
• New-age Banking - Which covers Open Banking, Embded Finance, BaaS
• ESG focussed trends covering integration, sustainable finance
• Emerging technology adoption including GenAI, CBDC/Crypto, Digital Identity
• Operational Resilience covering cybersecurity, realtime reporting integrated risk management
• Deposit growth - which covers online account opening, direct banking models and modernizing core to enable agility
• Expense Control by adopting new technologies such as AI and automation.

More details on this trend and our assessment of the adoption timeline and impact could be found at website. https://shorturl.at/xAMRV