Accenture Plc released its study on Wednesday revealing that major banks across the globe are in danger of losing billions of dollars of fee-based retail revenue coming from the intensified regulatory pressure and tougher competition as new entities offer no-fee services.
The study also noted that bank revenues across 12 markets around the globe in the form of overdraft fees or other charges for services will crumble by 5% in the next 3 to 5 years.
Banked on quantitative analysis of banks’ revenue pools in 12 countries including the U.S., U.K., Australia, and Hong Kong, the study surveyed almost 15,000 bank customers from those countries.
“These players are acting as a catalyst to force the industry to change. Banks will not be able to be as reliant on non-transparent fee-based revenues as they have been doing in the past,” Alan McIntyre, global head of Accenture, said.
The research also warned that bank revenues may decline since bank regulators are now mandating simple free structures to protect customers.
Moreover, the study advised that banks should start integrating artificial intelligence and predictive analytics to gain more trust from customers and boost revenue growth.