That’s what we predicted for Indian financial services in 2024

Wow, what a wild trip 2023 turned out to be for India, proper? We obtained a spanking new Parliament, nailed house missions, efficiently organized the G20 Summit, and even saved folks caught in a tunnel! Then elections buzz and a close to miss at successful the ODI World Cup obtained us all labored up in This fall.

Now, right here at Forrester India, now we have wrapped up our 12 months with a bang — a profitable three-city India Predictions tour, the place we unveiled our meticulously researched predictions. And let me inform you, our predictions have been an actual smash hit. The credit score goes to everybody concerned at Forrester, together with our superior purchasers and everybody who graced our occasions. The post-event one-on-ones have been buzzing with appreciation, particularly for the powerhouse ladies who took the stage. It was so superior that I might speak about all of it day! However let’s settle down a bit, take a deep breath, and get into the great things; should you missed it, I can’t wait to spill the main points, so right here we go!

Prediction 1: Fintechs and conventional FIs that neglect to design area of interest journeys will lose market share.

In India, on-line adults exhibit a excessive stage of belief of their main banks, but solely 33% understand their fundamental financial institution as distinct from others, which raises a purple flag. Fintechs and neobanks are altering the sport by shifting from constructing merchandise to concentrating on persona-specific wants. By specializing in extremely particular segments, they’ll craft hyper personalised and environment friendly consumer journeys tailor-made to various group wants. We imagine this transformative pattern is not only a passing section; it’s right here to remain. In 2024, we count on a surge in modern fintechs providing contemporary and game-changing options. We additionally anticipate a number of conventional FIs will acknowledge the worth of serving particular teams with distinctive wants and habits and can then creatively deal with them. The bulk might miss this wave, nevertheless, risking a loss in market share.

Prediction 2: Two banks will considerably outperform their friends and enhance the digital maturity hole.

Clients are looking for extra than simply transactional capabilities; they need their banking apps to contribute to their monetary well-being, present personalised companies, and provide dwell assist. Sadly, most Indian banks fall quick of assembly these expectations. Whereas adept at transferring cash, they’ve vital room for enchancment in different areas. The important thing lies in going past merely being a processor of monetary transactions. They have to prioritize providing holistic monetary necessities to assist their clients’ monetary well-being. Most bankers perceive this shift, however solely a few them have began appearing on it. How do we all know? We work with various them, and that is typically a spotlight space of our engagement. Quite the opposite, those neglecting to put money into monetary well-being packages will wrestle and danger dropping clients to suppliers higher geared up to supply general monetary care.

Prediction 3: Open finance will choose up velocity, however 90% of monetary service corporations will wrestle to monetize it.

Due to the Account Aggregator framework launched by the Reserve Financial institution of India two years in the past, open finance has began gaining traction in India. It’s garnering participation from main private and non-private sector banks, asset administration firms, inventory depositories, insurers, and others. Regardless of a powerful 82% dedication from banks to open finance initiatives, they haven’t been in a position to drum up buyer enthusiasm because of information privateness and safety issues. We count on clients to demand much more readability on the utilization of their information and safety measures. Monetary companies suppliers will fail to persuade clients and gained’t monetize open finance alternatives, until they’ve a compelling worth proposition, which sadly appears unlikely given their concentrate on cross-selling and upselling extra, fairly than utilizing the information for delivering worth again to clients.

In 2024, the highlight shall be on monetary inclusion. Monetary companies corporations will seek for progress in underserved segments and promote digital literacy. To navigate this aggressive and altering market, our steering for monetary entities shall be to:

Assess digital maturity and take steps to create an omnichannel expertise.
Use information neatly to construct sturdy connections with clients.
Hold clients on the coronary heart of product and answer design.

As a Forrester consumer, you possibly can learn our Predictions 2024: Banking and Predictions 2024: Funds reports. Not a Forrester consumer? Obtain our complimentary Predictions information, which covers our prime predictions for 2024. Need to speak to us? Please revery out.