- AI and Automation Dominate – Banks will rely heavily on AI-driven chatbots, automated loan approvals, fraud detection, and personalized financial advice, reducing costs and improving efficiency. Globally, banking chatbots handled around 80% of routine customer interactions in 2023, saving banks approximately $7.3 billion in operational costs (Juniper Research).
- Embedded Finance Grows – Financial services will become increasingly embedded within non-financial platforms such as e-commerce, social media, and fintech applications, enhancing accessibility and convenience for consumers. This integration is essential for improving user experience, driving revenue growth, and expanding financial inclusion, with the market projected to reach $7 trillion by 2030 (Bain & Company).
- Decline of Physical Branches – Traditional bank branches will continue to close as digital banking adoption rises, with some institutions transitioning to fully virtual banking experiences. Since 1986 we have seen 14,773 banks branches close down across the UK. This trend is expected to amplify beyond 2025 as many banks will continue to look at optimising costs and providing a more efficient digital engagement through online channels.
- CBDCs and Stablecoins Gain Traction – Central Bank Digital Currencies (CBDCs) and regulated stablecoins are expected to drive digital payment efficiency and security, reshaping both domestic and cross-border transactions. CBDCs, backed by central banks, combine fiat currency stability with digital speed, while stablecoins offer a trusted alternative to volatile cryptocurrencies. Their adoption could enhance monetary policy control, reduce transaction costs, and increase financial inclusion by providing secure digital financial access in underbanked regions.
- Tighter Cybersecurity Measures – With increasing cyber threats and financial fraud, banks will invest heavily in zero-trust security models, biometric authentication, and blockchain-based security solutions. The global cost of cybercrime is expected to reach $10.5 trillion annually by 2025 (Cybersecurity Ventures). According to IBM’s 2023 “Cost of a Data Breach” report, the average cost of a data breach is $4.45 million per incident globally, with U.S. businesses facing even higher costs of $9.44 million.
- ESG-Driven Banking Becomes Standard – Banks will prioritize sustainable finance, integrating Environmental, Social, and Governance (ESG) factors into lending decisions, investment strategies, and compliance measures.
- Open Banking Expands – More countries will enforce or enhance open banking regulations, pushing banks to share data with third-party providers and creating more competition and innovation in financial services. This will also lead to consumers having more choice around how they conduct banking, so the experience with their current banking providers needs to be leading edge.
- Quantum Computing Threats and Opportunities – As quantum computing advances, banks will need to upgrade encryption methods to protect against potential cyber threats, while also exploring quantum-powered financial modelling for risk assessment and portfolio optimization.
