The Future of Banking in Emerging Markets

Report Previously Published by Oliver Wyman
May 15, 2012
Global, Asia-Pacific, EMEA, Latin America, North America


Emerging markets represent a significant growth potential for banking revenues. A new Oliver Wyman report explores such opportunities and provides recommendations for banks looking to compete in emerging markets.

Several emerging economies have grown at extraordinary rates over recent years, China, India, and Brazil most obvious among them. Their banking sectors have grown even faster, as tens of millions of their previously impoverished citizens have moved above the “bankable” income threshold, with technological innovations, such as mobile banking, speeding up this process.

Yet this development is still in its early stages: compared to the West, only a small portion of the emerging economies’ populations have bank accounts, or access to consumer credit and the mortgage market. This means that banking revenues are still small, and there is great growth potential for incumbents and entrants.

“In this paper we present our projections for the growth of banking in the twelve emerging economies that we believe provide the most attractive opportunities. We consider the risks to this growth, estimate how it will translate into bank revenues and profits, consider the growth potential of retail, define priorities for the near term and, finally, give some advice for banks looking to compete in emerging markets,” says Greg Rung, Dubai-based Partner in Oliver Wyman’s Retail and Business Banking Practice and coauthor of the report.

Michael Wagner, coauthor and New York-based Partner in Oliver Wyman’s Retail & Business Banking Practice adds, “In order to capture the potential in emerging markets, banks need to have a clear long-term strategy. We recommend a portfolio approach of 'select scale' where players choose their focus markets and invest on them by making improvements across the value chain as they tread the path to maturity.”

Oliver Wyman Contact
Paola Garbini
+39 02 3057 7442

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is a wholly-owned operating unit of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America
Michele Pace
Tel: +1 212 345 1366

Europe (London)
Chris Williams
Tel: +44 (0)782 448 3336

Asia (Tokyo)
Yumi Nagaoka
Tel.: +81 3 3500 3023

Table of Contents

1. Introduction


2. The Ultimate Growth Story


3. Retail; The Growth Engine


4. What About Profits?


5. The Major Uncertainties


6. Regional Variations in the Near Term


7. Imperatives for Banks in Emerging Markets



7.1 Managing Multi-Country Portfolios



7.2 Optimising Local Operations




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