Summary

The China retail banking market is on path to become the world’s second largest by 2024, with the industry’s aggregate income growing 10% to reach CNY 3.2 trillion (USD 471 billion).

Key Highlights
Retail banking contributed to 27% of the country’s total banking income in 2017, up from 22% five years earlier, but still a long way from the international norm of between 40 and 50%.
This compels Chinese banks to seek out fresh income sources, especially since corporate banking, which is traditionally the biggest revenue contributor, has been pinched by rising bad loans amid the slowest economic growth in almost three decades, and structural reforms to retire obsolete capacity among state enterprises.
Leading Chinese banks have already witnessed the increasing urgency to reshape their retail banking operations to meet the evolving needs of retail clients, and face off competition brought by disruptive internet finance players.


Key Market Trends

China Retail Banking Customer Satisfaction in 2017

Mobile banking had witnessed a surge of usage in China, with its penetration reaching 78% in 2017, up 26-fold from just 3% in 2011, and Chinese retail bank customers now use mobile banking more than 25 times a year. Customers who use mobile are more satisfied than those who do not use mobile. This is especially true for VIP customers. VIP customers are respondents who indicate having VIP accounts in their evaluated banks.

VIP customers also tend to use mobile banking more frequently. The study shows that 11% of VIP customers conduct financial business each day on a mobile app, twice that of non-VIP customers. Nearly half (48%) of all VIP customers manage their finances on a mobile banking app every week.

Contribution of the Retail Business to Operating Income of the Listed Banks in 2017

At the individual level, in 2017, the contribution to profit before tax from the retail business of CCB, ABC, CMB, PAB, JTRCB, and PSBC all exceeded 45%, with PAB at the top of the list at 67.62%. In terms of the contribution of the retail business to operating income, CMB, PAB, GRCB, and PSBC all ended up with a contribution of over 40%, with PSBC on the top of the list at 66.17%

Competitive Landscape

The report covers major international players operating in the China retail market industry. In terms of market share, few of the major players currently dominate the market. However, with technological advancement and product innovation, mid-size to smaller companies are increasing their market presence by securing new contracts and by tapping new markets.


Postal Savings Bank of China
BNP Paribas China
Citibank China
HSBC Bank China
Bank of China
China Merchants Bank
China Development Bank
China Construction Bank Corp
Agriculture Bank of China
Bank of Communications


Additional Benefits:

The market estimate (ME) sheet in Excel format
3 months of analyst support

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