Asia’s banks hold the mandate to innovate. Now they must earn it.

Banking is no longer measured against other financial institutions, but against digital experiences. 

The evolution of banking in Asia’s money centres is often framed as a contest between incumbents and disruptors. Yet research on 2,000 retail banking customers across Hong Kong and Singapore suggested something else. 

Traditional banks remain the default financial partner for almost everyone, but the expectations placed on them have shifted dramatically. The institutions that will define 2026 are not merely those with scale or balance-sheet strength, but those capable of delivering daily, visible value in an era shaped by seamless digital experiences and responsible AI.

Across both markets, about 95% of consumers continue to rely on a traditional bank for everyday needs. Far from being displaced, incumbents remain trusted, deeply embedded, and viewed as the natural engines of future innovation. 

Around 40% of Hong Kong respondents and 31% of Singapore respondents believe traditional banks will lead innovation to 2030, ahead of digital-only challengers, non-bank fintechs, Big Tech, and AI firms. 

The mandate to innovate still sits with the banks.

Consumers are no longer comparing banks to banks
The challenge lies in how consumers now judge that innovation. Banking is no longer measured against other financial institutions, but against the best digital experiences available anywhere. 

The divergence between the two markets is instructive: in Hong Kong, 42% of consumers rate banking as the top digital customer experience sector. In Singapore, e-commerce leads at 42%, with banking close behind at 39%. 

For Singaporean consumers in particular, the benchmark has been set by the frictionless journeys offered by regional e-commerce giants.

This shift in expectations is also reshaping how banks are perceived. Even though incumbents dominate usage, a significant share of consumers feel that non-bank fintech providers deliver more tailored financial experiences. 

In Singapore, 36% believe banks offer less personalised experiences than fintechs. In Hong Kong, 33% say the same. Personalisation has quietly become one of the sector’s most important competitive battlegrounds.

The research highlighted the three most consistent consumer expectations across both cities: enhanced security, user-friendly digital tools that make daily money management easier, and personalised guidance that feels relevant rather than generic. 

Banks are no longer judged simply on trust or institutional reputation, but on whether everyday digital interactions feel designed around individual needs.

AI moves into the mainstream
AI sits at the centre of this shift and will be pivotal in shaping the next phase of digital banking. Yet the research makes clear that consumers want AI to address specific needs, not act as a blanket solution. 

The priorities differ by market. In Hong Kong, consumers are most interested in AI tools that help them make better investment decisions. In Singapore, the top priority is fraud detection and prevention.

Despite these differences, willingness to adopt AI is remarkably consistent. More than approximately half of consumers in both markets say they are likely to use bank-provided AI tools for investment support. The opportunity is real, but must be delivered with transparency, explainability and visible human oversight.
AI also interacts directly with the personalisation gap. If banks can use AI to tailor insights, anticipate financial needs and surface truly relevant actions, they can begin to close the perception that fintechs offer more bespoke experiences. If they cannot, the gap may widen.

What will define banking in 2026? Three clear themes
The first is experience as the competitive frontier.

Banks must build digital journeys that match the ease, clarity and speed consumers receive from e-commerce platforms. Singapore’s numbers make this especially clear, but the imperative applies across the region.

The second is the maturity of AI.

Consumers now expect AI that improves real-world outcomes – preventing fraud, offering sharper investment insights and delivering more personalised guidance. They do not want AI in credit decisions that feel opaque or automated without accountability.

The third is the personalisation race.

With 36% of Singaporeans and 33% of Hong Kong respondents saying banks offer less personalised experiences than fintechs, incumbents face rising pressure to demonstrate that they can adapt services for the individual. This is no longer a marginal differentiator. It is central to how consumers evaluate value, quality and relevance.

A blueprint for the next phase of Asian banking
Asian banking enters 2026 with enormous strengths: deep incumbency, broad confidence and highly engaged digital consumers. 

But those same consumers are raising the bar. The future will belong to banks that can turn trust into tangible, everyday value, and innovation into experiences that feel intuitive, human, and tailored.

The next phase of competition will not be about technology for its own sake. It will be about who can translate capability into personal relevance. In that respect, the consumer voices in this research are less a forecast than a blueprint.