DUBLIN--(BUSINESS WIRE)--Research and Markets (http://www.researchandmarkets.com/research/wk584z/personal_banking) has announced the addition of the "Personal Banking Market Assessment 2012" report to their offering.
The banking crisis and the subsequent recession have resulted in the personal banking market receiving a great deal of media attention of late, with little of that attention being positive. The current situation and the negative media attention has given bank customers generally very little confidence in the sector, which has affected the way in which it works.
During the mid-2000s, the emphasis was on the expansion of personal banking services, with Internet-based start-ups utilising an era of easy credit and free access to capital in order to set up Internet-only banks. Supermarkets also got in on the act, diversifying into offering financial services products. However, following this period of expansion came the credit crunch and the recession.
The global credit markets seized and neither customers nor banks could borrow the money they required. As such, many Internet banks were absorbed into much bigger, longer-standing financial institutions or disbanded altogether and the supermarkets delayed their forays into the personal banking market.
Tesco will not be launching its current accounts now until at least 2013 for various reasons, despite being relatively well-placed to do so prior to the recession, when it purchased the Royal Bank of Scotland's (RBS') 50% stake in Tesco Personal Finance, with the delay being indicative of the current situation within the market.
The market continues to be dominated by the big four' banks (HSBC, Lloyds, RBS and Barclays) with the current economic and financial situation making it very difficult for new players to break into the market. Furthermore, despite the financial crisis, consumers generally trust in these larger, longer-established institutions than newer ones when it comes to the deposits held on customers' behalves. These big four banks have been undergoing a diversification process in order to supply financial services products across the range and best suit their customers' needs, and continue to assert their dominance on the market.
Despite the apparent decline (for now) of solely Internet-based banks, technology now plays a key part in the industry, with electronic and automated methods of personal banking rapidly rising in importance, not just to banks and customers, but also to the wider economy. Mobile phone applications as a method of banking are becoming commonplace, as is new contactless' payment technology which does away with PINs for most transactions and reduces the need to carry cash.
This future for the personal banking market is hard to predict as so many factors collide to create situations which affect it, either positively or negatively. The Eurozone is the biggest concern for the personal banking market currently, with uncertainty over the future fate of the single currency in Europe being perhaps the single biggest factor depressing the personal banking market at the moment.
If the currency collapses or certain countries are forced to leave, then the rebounding consequences would prove disastrous for the personal banking market in the UK, still struggling as it is at the time of writing. However, if the situation in the Eurozone is resolved, or certain aspects of it are eased, then the personal banking market in the UK is likely to recover at a much faster rate than if the situation remains extant.
Companies Mentioned
- Barclays Group
- The Co-Operative Banking Group Ltd
- HBOS PLC
- HSBC Holdings PLC
- Lloyds Banking Group PLC
- Nationwide Building Society
- The Royal Bank of Scotland Group PLC
- Santander UK PLC
- Virgin Money Ltd
For more information visit http://www.researchandmarkets.com/research/wk584z/personal_banking