The global Digital Banking Platforms market size is expected to grow USD 8.2 billion in 2021 to USD 13.9 billion by 2026, at a Compound Annual Growth Rate (CAGR) of 11.3% during the forecast period.
The digital banking platforms market is gaining traction due to the increasing adoption of smartphones is contributing to the growth of the digital banking platforms market. Countries such as India, Indonesia, South Africa, and China have seen high growth in smartphone sales in the last few years. According to the GSM Association (GSMA) Mobile Economy 2020 report, there will be 7.1 billion smartphone connections by 2025 from 5.2 billion in 2019. The adoption rate would increase from 65% to 80% by 2025.
The emergence of open banking mechanism enables third-party service providers to securely access the financial information of customers and in real-time through Application Programming Interfaces (APIs). With this approach, banks can provide tailor-made financial products, particularly payment solutions, to their existing customers.
The scope of this report covers the digital banking platforms market by component (Platforms and services), banking type, banking mode, deployment type, and region. By Component, services segment has a key role to play in the Digital Banking Platforms market and is expected to grow at the highest CAGR during the forecast period. Among Banking Mode, Online Banking segment is expected to hold a larger market size during the forecast period. The online banking platforms facilitate banks to offer banking services to end users over the internet. The existing dominance of online banking is now gradually getting shared with the introduction of mobile banking platforms. However, this mode is preferred by the traditional banks who are still in the digital transformation phase and by end users who are still reluctant to use smartphones for banking services.
Among Banking Type, Corporate Banking segment is expected to hold the highest growth rate during the forecast period. Corporate banking solutions provide banks and corporates with a seamless, connected corporate banking experience and a 360° view of the business. This results in integrating payments, treasury, lending, trade, and supply chain finance, benefiting both customers and corporates. Several organizations are incorporating corporate suites that provide superior features to corporate banks. By Deployment Mode, Cloud segment is expected to have a higher growth rate during the forecast year. The cloud deployment type has become a cost-effective and efficient way to handle all operational processes of insurers, along with data management and governance issues. Cloud-based digital banking platform tools offer several benefits, such as the rapid implementation of tools, reduced setup and operational costs, less maintenance costs, 24/7 data accessibility, security, and ease of use. Digital banking platforms and capital markets and increasingly inheriting cloud for storing data and accessing advanced applications through the internet.
APAC is expected to grow at the highest CAGR during the forecast period. The APAC region is expected to have the fastest growth rate in the digital banking platforms market during the forecast period due to its growing adoption of technologies. The high rate of adoption of digital technologies, especially in emerging economies, such as Singapore, Australia, India, China, and Japan, has made APAC a lucrative market in the IT industry. Strong banking capabilities, including digital offerings, strong financial positions, and digital structures, are expected to drive the growth of the digital banking platforms market in the APAC region. Companies in APAC would benefit from the flexible economic conditions, industrialization, the globalization-motivated policies of the government, and the expanding digitalization in the region.
The Banking as a Service (BaaS) model has significantly shown major growth in the digital banking industry. It is a model in which licensed banks integrate their digital banking services directly into the products of other non-bank businesses. This enables a non-bank business to offer its customers digital banking services, such as mobile bank accounts, debit cards, loans, and payment services, without needing to acquire a banking license of their own. BaaS allows digital banking platforms to connect directly to the bank systems through APIs. FinTech companies are adopting BaaS as an evolving technological trend for building innovative financial services and tailor-made digital strategies.
Key and innovative vendors in Digital Banking Platforms market are Alkami (US), Apiture (US), Appway (Switzerland), Backbase (Netherlands), BNY Mellon (US), CR2 (Ireland), EdgeVerve (India), ebankIT (England), Finastra (UK), Fiserv (US), Intellect Design Arena (India), Mambu (Germany), MuleSoft (US), nCino (US), NCR (US), NETinfo (Cyprus), Oracle (US), SAP (Germany), Sopra Banking Software (France), TCS (India), Technisys (US), Temenos (Switzerland), TPS (Pakistan), Velmie (US), and Worldline (France).
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