What are the major trends expected to change banking in 2024?
ANSWER:
The banking sector is poised to undergo significant changes in 2024, primarily driven by the adoption of generative artificial intelligence (gen AI). This technology is expected to boost productivity by 20-30% and increase revenue by 6%, necessitating banks to leverage cloud and data more effectively and reconsider their approaches to work and talent. Other key trends include capturing the digital dividend, addressing unseen risks, reimagining new working methods, utilizing the power of pricing, adopting a cloud-first mentality, recalibrating regulations, transitioning from technology management to an engineering mindset, unlocking core system potentials, and surpassing traditional optimization methods like Six Sigma through gen AI's capabilities.
CATEGORY
How will the global economic environment in 2024 impact the banking industry?
ANSWER:
The banking industry in 2024 is expected to face challenges due to a slowing global economy and a landscape marked by higher interest rates, a reduced money supply, assertive regulations, climate change, and geopolitical tensions. Banks will need to navigate multiple disruptive forces while managing costs and generating income in new ways. Global inflation is predicted to decrease to 5.2%, with advanced economies experiencing tepid growth. The International Monetary Fund forecasts a world economy growth of no more than 3.0%, with India expected to see one of the strongest growth rates at 6.3%. On the other hand, China may experience an economic slowdown impacting global recovery efforts. Central banks globally are anticipated to fine-tune their monetary policies to address these issues, with varying approaches to interest rates across different countries.
