Futureof Banking Industry
Futureof Banking Industry
Avariety of forces are remodeling the banking industry therebyresulting in an imperative for change that compels the financialinstitutions to select one or all of the three options of leading thechange, following fast, and managing for the present (Hanc, 2010).Whichever strategy chosen, the future of banks are likely to beshaped by the environmental factors of economic, regulatory, paymentsystems, demographic, technology, and demographic issues (Davies &Green, 2010). Regarding the economic environment, the future isbright for the banking industry as the period is forecasted to harbora climate of moderate economic development devoid of severerecessions that have for a long time hindered the sector’s growth.Secondly, banking entities also have a future opportunity to generatemore profits due to the predicted high population of retired agedcategory in demand of financial support due to their tendency toengage in asset liquidation including their bank deposits (Hanc,2010). Furthermore, the future is predicted to feature deregulationof the powers of banks by the states and that will save theinstitutions the current burdens of excessive regulations which arecriticized for hurting banks, preventing new entrants, and denyingthe bank clients the benefits that accrue in the market due tocompetition (Kroszner & Strahan, 2014). Also, banks are likely totake advantage in the future due to tremendous achievements noted inthe technological environment which has seen the introduction ofdigitized banking through fintech and ready communication flow viathe internet (SKAN, DICKERSON & MASOOD, 2015) these advances arebelieved to persist for many years and the financial institutionswill increasingly and consistently benefit. Moreover, banks areentering a new phase of checkless payment systems involving the useof electronic payment forms the achievements will augur for theotherwise technologically-oriented generation who would enjoy theprospect of such payment methods and earn the sector more customers(Singh & Malhotra, 2015). Simply put, therefore, the futurebanking environment is promisingly favorable and indicative ofmassive growth of the sector in the years ahead compared to the pastand current business environment.
Davies,H., & Green, D. (2010). Bankingon the future: the fall and rise of central banking.New Jersey: Princeton University Press.
Hanc,G. (2010). The Future of Banking in America-Summary andConclusions. FDICBanking Review Series, 16(1),65-72
Kroszner,R. S., & Strahan, P. E. (2014). Regulation and deregulation ofthe US banking industry: causes, consequences, and implications forthe future. In EconomicRegulation and Its Reform: What Have We Learned? (pp.485-543). University of Chicago Press.
Singh,B., & Malhotra, P. (2015). Adoption of Internet banking: Anempirical investigation of Indian banking Sector. TheJournal of Internet Banking and Commerce, 12(4),502-515.
SKAN,J., DICKERSON, J., & MASOOD, S. (2015). The Future of Fintech andBanking: Digitally disrupted or reimagined. NewYork: ME Sharpe.