Five scenarios for the future of retail banking: Building strength amid transition

August 2022

Retail Banking 2025 and Beyond

Retail banks face a confluence of challenges making this one of the toughest periods in the industry’s history.

Our analysis suggests several possibilities for how the next decade could unfold. Now is the time to consider radical future-facing scenarios to prepare to build the capabilities and resilience that will be necessary to thrive in tomorrow’s far more dynamic environment.


Retail Banking 2025 and Beyond reports on the five trends that will shape the future of banking, and offers five scenarios. Though deliberately exaggerated, all scenarios represent an urgent call to action for retail banks and point specifically to three priority areas.

Five trends that will shape the future of retail banking

Underpinning our five scenarios for the future of banking are five dominant trends that banking leaders need to understand to plot a course through a changing market landscape:

  1. Disruptive technology and innovation
  2. Embedded finance
  3. Evolving customer expectations
  4. Consolidation to pursue scale
  5. Regulatory complexity

Five scenarios for the future of retail banking

By drawing on the global, collective experience of PwC professionals in retail banking, we’ve developed five extreme scenarios that leaders can use to strategize how they will fit into the future retail banking ecosystem:

  1. Front-end revolution: New players outside of traditional finance capture client relationships. Established banks compete as the infrastructure backbone of the financial system, acting as utility providers that offer licensed services and products but no longer have a customer-facing brand
  2. Winner takes all: A wave of consolidation results in a few mega banks and fintech companies ruling the banking landscape. These massive, tech-enabled institutions generate a competitive advantage through scale.
  3. Scattered landscape: Supervisory regime favours smaller and local banks, and sentiment gravitates towards nationalistic protection; clients and assets flow from global players to more locally focused banks with smaller balance sheets, deposits, and lending facilities, along with specialized micro-niche players. Fewer institutions operate across borders.
  4. Resurgent regulators: Regulators take an active approach to BigTech and other non-traditional entrants to ensure a safe and strong financial system. This opens the door for banks to rebuild trust and reclaim their role as the central provider of financial products and services.
  5. The rise of the central bank digital currencies: The steady decrease in the use of cash continues alongside the roll out of central banks digital currencies (CBDCs). Digital currencies gain wide acceptance in B2B, B2C, and C2C segments. Incumbent banks lose the basic bank account to central banks.

Three priorities for shaping the future

The trends and scenarios we’ve highlighted point to a clear message: banks need to repurpose themselves to remain relevant. What’s more, although the scenarios are cautionary, they also suggest valuable lessons upon which banks can draw to frame trade-offs and action plans:

  1. Tech powered transformation
  2. Data-enabled customer focus
  3. Broad-based trust

Contact us

Ruth F. Blasco-Viguilla

Ruth F. Blasco-Viguilla

Assurance Partner, PwC Philippines

Tel: +63 (2) 8845 2728

Rocky Saldajeno

Rocky Saldajeno

Markets Director, PwC Philippines

Tel: +63 (2) 8845 2728

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