Unfortunately, these may be the wrong places to look for growth. Projected annual growth in these markets is forecast to be 2%-3% through the next several years. In contrast, projected growth in Latin America, Asia and eastern Europe is two or three times greater.
However, the latter regions have been ignored by the banking industry, as shown by the per capita figures for banks loans and deposits. Opportunities to develop these markets will require innovative thinking. Two examples are the Spanish banks in Latin America, and the South African government-created Mzansi account, with a very low deposit minimum and basic payment services. Both serve the previously unbanked.
James R Eckenrode is managing director of the Banking and Payments practice at TowerGroup.
