Datamonitor, a premium business information company specializing in industry analysis, predicts the size of the eBanking technology market to almost double over the next four years, growing from $2.7 bn in 2001 to nearly $5 bn by 2005 in Europe. Moreover, 75 million Europeans will be banking on the Internet by 2005: equivalent to over 2.5 times the combined population of every capital city in the EU. The PC will remain the most popular online channel for banking services, followed by wireless devices and interactive digital television.
The report, eBanking Technology in Europe 2001, forecasts a tripling of the number of customers using PC-based Internet banking services over the next five years, from 23 million at the end of 2000 to over 75 million in 2005. The combined population of the capital cities of all the EU member states is currently estimated at around just 28 million.
Certainly the last few months have not been easy ones for Internet banking in Europe, with standalone ventures such as ABN-Amro s MoneyPlanet and SEB s planned UK expansion being withdrawn. The saturation of many European markets and the negative outlook for Internet investment has made all but the most differentiated standalone Internet propositions unsustainable.
However, Datamonitor s research shows that, in spite of this, banks are being successful in migrating their customers onto the Internet, giving them plenty of reasons to continue investing strongly in eBanking services in order to support this growth.
Datamonitor is bullish about the future uptake of mobile phone banking. While initial uptake of WAP-based services has been limited, the advent of 2.5 and 3G networks will allow for richer banking services to be delivered via the wireless channel. As a result, Datamonitor forecasts almost 35 million customers banking on WAP by 2005.
SiÃ¢n Jones, eFinancial services analyst at Datamonitor, comments:
In spite of some recent setbacks, eBanking is still the strongest growth story in European retail banking. The availability of more and more value-added services, such as account aggregation and online advice, will going to continue driving strong consumer uptake of eBanking services. The challenge for banks now will be to hang on to these customers through using advanced personalization and one-to-one marketing technologies to build up loyalty.
We are particularly excited by the potential of mobile devices. Although there has been some initial customer disappointment in WAP services, we firmly believe that, when higher bandwidth networks and suitable handsets become widely available, mobile banking will become a killer mCommerce application. Our research has shown that banks are very committed to investment in this area: after all, mobile phones are ideal for receiving timely financial information. These kind of services are highly sticky should also help build customer loyalty.
Datamonitor plc is a premium business information company specializing in industry analysis. We help our clients, 5000 of the world s leading companies, to address complex strategic issues. Through our proprietary databases and wealth of expertise, we provide clients with unbiased expert analysis and in-depth forecasts for six industry sectors: Automotive, Consumer Markets, Energy, Financial Services, Healthcare, Technology. Datamonitor maintains its headquarters in London and has regional offices in New York, Frankfurt, and Hong Kong.Details