Banking industry is going through a rapid transition phase all over the world. Small banks are facing a fierce competition from the big players. Virtual banks in Internet are challenging the traditional banking system and global boundaries are being smashed day-after-day that gives birth to a small global village. Plato said once "The unexamined life is not worth living". So let us understand what will be the future of retail banking after 25-30 years? What are the services you can expect from them?

The scale of the global opportunities, the complexity of the competitive arena, and the relentless performance discipline imposed by the capital markets will force all the banks either to specialize and become world class in their chosen field, or exit. There will be no small banks in national or regional level as they would either be taken over by the multi-national banks or they would exit from the business, forced by the global competition. Banks will be the one-stop shop for all your personal finance needs. Nevertheless, banks will adopt the loyalty-based competitiveness to make you bank with them assuring highest level of customer satisfaction.

Banking Network: The number of ATMs will be very high and all the banks will be sharing the each other’s ATM network due to space problem and to reduce the cost of operation. Presently, traditional banking costs the banks more than a Dollar per person, ATM banking costs 27 Cents and Internet banking costs below 4 Cents approximately. Banks will try reduce the banking costs more but there will always be a high demand for face-to-face interaction from customer side - indicates Mckinsey Quarterly Research.

Service Offerings: Banks will be a one-stop shop for all your personal finance needs. You will get all insurance products and broking services to trade in the share market apart from all the possible banking services. Balancing customer needs in retail banking distribution will be a crucial factor for the success of the banks. Regulatory hassles will be too less and there is a high possibility that Investment banks, Insurance companies and Retail Banks will integrate their operation in parts to serve the customers better. Wireless financial services, an important part of m-commerce will offer consumers a new level of convenience in an increasingly busy world with high-speed technology. BCG estimates that within few years, hundreds of millions of people worldwide will use m-commerce applications, generating business-to-consumer revenues of up to $100 billion.

Social Responsibility: Banks will take the role of social institutions and will act as social advisors. Personal finance advisory services will be available in your mobile devise from time to time, indicates Boston Consulting Group’s research. Banks will be the most powerful social institutions, as they will hold the individual’s money. The level of personalization will be too high and you will be offered services like day-to-day spending management. You can actually pre-program your yearly budget at a particular time and thus your mobile device will alert you if you exceed your day’s spending.

Loyalty Based Competition: The concept of Boston Consultancy Group’s ‘Time based competitiveness’ may face a challenge from the concept of ‘Loyalty based competitiveness’. In other words, when all the banks start offering the highest level of customer satisfaction, customers will be confused and then banks will try to create the ultimate loyalty program to make sure, you will stick to the bank for quite a long time. The quest for loyalty will re-shape the customer satisfaction and you will experience far better privilege than now-a-days with bundle of benefits at less cost.

All the banks in future will fight with uncertainty and complexity due to the rapid global changes. The uncertainty creates fear and complexity creates confusion. Therefore, they will try to be the excellent customer oriented banks to serve you better to ensure their survival.

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