This guide covers the 10 trends defining financial services in 2026, from the technology shifts transforming operations to the loyalty strategies keeping customers from switching to a competitor.
The finance sector is changing faster than most institutions can comfortably keep up with. Financial services trends such as agentic AI, open banking, and rising customer expectations are all reshaping what people expect from their providers and what it takes to keep them loyal.
The gap between institutions that adapt and those that don’t is widening. Fintech challengers and digital-only providers have set a new standard for convenience, and traditional providers are feeling it in both acquisition and retention.
Whether you’re thinking about technology investment, customer retention, or how loyalty fits into your growth strategy, here’s what you need to know.
Customers now expect the kind of seamless, personalised experience that digital-native providers have normalised, and generating new leads means meeting that standard before a competitor does.
Understanding where the industry is heading gives you a clearer view of where to focus. Here are the 10 trends shaping financial services in 2026.
Most financial institutions no longer see going digital as a strategic goal. It’s an operational reality, and the pace is accelerating.
Fintech and digital-only providers have built their entire model around low overhead, frictionless UX, and mobile-first access. That lets them offer lower fees, better rates, and an engaging customer experience that traditional providers have historically struggled to match.
The response from incumbents has shifted significantly in recent years. Beyond simply digitising existing processes, leading institutions are now rebuilding around composable, AI-powered platforms that can adapt in real time.
The reality is that banking systems have always been static, built to last decades. But that approach is no longer viable.
Investment is going into three main areas:
Data has moved from a reporting tool to a competitive asset. Financial institutions that use it well are making faster decisions, managing risk more effectively, and building customer relationships that are more difficult to break.
Personalisation is where the impact is most clearly seen. EY research show that 40% of banking customers tend to stick with a provider that offers more personalised service.
According to Accenture’s 2025 Global Banking Consumer Study, only 3% of consumers actively use the personalisation tools their primary bank offers, despite 72% of them stating that personalisation is important. That gap represents both a problem and an opportunity.
The applications are broad, but there’s serious traction around:
The shift toward AI-driven analytics is accelerating this further. Accenture found that banks with strong customer advocacy grow revenues 1.7 times faster than their competitors. Data is what makes that advocacy possible.
Open banking gives third-party developers access to bank data and APIs, with customer consent, to build new financial products and services.
It sounds technical, but the practical impact is significant: more competition, more personalised products, and more customer control over their own financial data.
The market is growing fast. The global open banking market was valued at around $35 billion in 2025 and is projected to reach $240 billion by 2035, expanding at a compound annual growth rate of 21% over that period.
Regulation has driven a lot of this growth. The EU’s PSD2 directive pushed banks to open their APIs to outside developers, and the updated PSD3 framework will go further.
In the US, new CFPB rules have given consumers the legal right to share their financial data with third parties for the first time. That’s created real space for fintechs and banks to work together rather than around each other.
Financial institutions are responding to open banking in several ways and these areas are seeing the most active investment:
Open banking rewards early movers. The data infrastructure being built now will define competitive positioning for years to come.
Regulation in financial services has always been demanding. In 2026, it’s also become more fragmented. Based on EY’s Global Financial Services Regulatory Outlook, the industry is now seeing a surge in localised regulations. This means that national regulators are writing rules that are more in line with their own domestic priorities.
That makes compliance a lot harder for companies that do business across borders, with four areas in particular driving the most pressure right now:
The smart approach is treating compliance as an operational discipline. That could mean investing in RegTech platforms that automate monitoring and reporting, building AI governance frameworks before regulators require them, and keeping cross-functional compliance, technology, and data teams closely aligned.
Customers increasingly want to know that their money is doing something useful. That shift in attitude is showing up in the products they choose, the brands they stay loyal to, and the institutions they walk away from.
The data supports this. RFI Global reports that 21% of UK consumers currently own a sustainable finance product; among those under 40, that number rises to over two in five. 50% of respondents also say they would like to try out a sustainable banking product.
That said, there’s a real tension here. Mintel’s 2025 UK sustainability research found that cost of living pressures have made it harder for many consumers to act on their sustainable intentions.
This clearly means affordability remains the biggest barrier. Financial services businesses that can make sustainable products genuinely cost-competitive, rather than premium, are better placed to reach the mainstream.
The most effective approaches tend to combine product innovation with incentive design:
The key word there is “genuine” because greenwashing remains a significant concern.
KEY ESG says that over the last five years, bogus sustainability claims have become a bigger problem for 85% of investors. Customers are paying closer attention, and so are regulators.
Recent years have seen an upsurge in cybercrime and fraud with the rise of remote work and digital transactions.
UK Finance’s 2026 Annual Fraud Report found that payment fraudsters stole £1.28 billion in 2025, up 4% from 2024. Fraud, as UK Finance put it, now “operates on an industrial scale” and poses a national security threat.
The broader picture is just as concerning. The UK Government’s Cyber Security Breaches Survey found that 43% of UK businesses experienced a cyber attack or security breach in 2025. For financial service specifically, 99% of UK finance leaders polled reported cyber incidents involving payments within the previous two years.
The nature of attacks is also shifting. Criminals are moving away from large-scale opportunistic attacks toward more targeted, sophisticated methods. AI-powered phishing, deepfakes, and social engineering are all on the rise.
The UK’s cybercrime caseload has grown 88% since 2020, reaching nearly 1.5 million incidents as of early 2026.
Investment is going up. According to PWC data, some 76% of financial service firms plan to increase cybersecurity spending over the next year, with many preparing major budget uplifts.
The focus is shifting from reactive defence to proactive resilience, with three priorities emerging:
Security sits on board agendas, shapes product decisions, and increasingly defines how much customers trust a financial institution with their money.
AI is now widely deployed across the financial service industry. The question most institutions are asking now isn’t whether to use it, but how to scale it effectively.
According to the 2026 Global AI in Financial Services Report from Cambridge Judge Business School, 81% of financial services firms are adopting AI at some level.
Productivity gains are already being felt, with 79% of firms reporting positive impacts in technology and data functions, 75% in back-office operations, and 69% in front-office and client-facing roles.
Despite these results, 55% of firms say they still find it difficult to measure the full value of their AI investment, which suggests the gains are real but the tools for verifying them are still catching up.
PwC’s 2026 AI Performance Study adds an important caveat: only 20% of organisations capture up to 74% of AI’s economic value. The gap between those using AI strategically and those still experimenting is widening fast.
The applications cover the entire finance sector, but a few areas stand out:
That last point is where AI is having a particularly direct impact on retention.
In Propello Cloud’s 2025 Loyalty Uncovered Report, 62% of enterprise brands are already investing in AI and machine learning for their loyalty programmes, using these technologies to move from broad segmentation to genuinely individual experiences.
In 2026, the focus has shifted from simply cutting costs to rebuilding operations in a way that’s faster, more resilient, and better equipped for what’s coming next.
Legacy infrastructure, manual processes, and fragmented systems are giving way to API-driven platforms that support real-time payments, AI tools, and third-party integrations without the bottlenecks of batch processing.
AI and workflow tools now handle back-office tasks like reconciliations, KYC checks, and compliance reporting, freeing up teams for higher-value work.
Cloud modernisation is at the heart of this transformation. The LSEG Global Cloud Survey says that 82% of financial services companies now use a hybrid or multi-cloud cloud strategy.
More than half have already migrated key workloads and are seeing measurable value, particularly in risk management, customer engagement, and data access.
The same research reveals that 84% of firms have had to adjust their cloud strategies in response to regulatory requirements like DORA and GDPR, which shows just how tightly operational and compliance priorities are now linked.
The Loyalty Uncovered Report from Propello Cloud also shows 81% of enterprise brands cite API integration complexity as a major challenge, and 69% now prefer outsourced loyalty solutions over in-house development. Speed to market was the decisive factor in most cases.
For financial service businesses, the build vs buy question has largely been settled. Speed, scalability, and specialist expertise are winning the argument.
Customer experience has become the primary battleground in financial services. Customers aren’t comparing their bank to other banks anymore. They’re comparing it to the last great digital experience they had, whether that was a retail app, a streaming service, or a food delivery platform.
According to YouGov’s 2025 UK Financial Services research, Gen Z places a premium on ethical practices, mobile-first experiences, and transparency when choosing a bank.
Only 63% of UK adults believe that customer service has improved, despite 51% believing that banks have improved their ability to protect customers from harm two years after the FCA’s Consumer Duty was implemented.
It’s clear that there’s still significant ground to cover.
The investment is going into three areas in particular:
For years, industry giants like Barclays (Blue Rewards) and CitiBank (ThankYou Rewards) have used loyalty programmes to enhance the customer experience.
The difference now is the expectation of personalisation. A programme that doesn’t reflect individual behaviour is far too easy to ignore.
Keeping a customer is far cheaper than finding a new one. Acquiring a new customer costs five to seven times more than retaining an existing one.
With switching easier than ever, holding on to the customers you already have makes obvious commercial sense.
The numbers back it up. A 5% improvement in retention can boost profits by between 25% and 95%.
Yet most loyalty initiatives in financial services still focus on a single product or a one-off transaction, even though that approach does very little to keep customers around long-term.
Cross-product programmes that reward the full relationship are where the real gains lie. EY cites one leading bank that hit a 99% annual retention rate, against an industry average of 75%.
Propello Cloud’s Loyalty Uncovered Report found that 83% of enterprise brands struggle with customer engagement, and 80% report difficulties managing churn.
The ones making progress tend to focus on four things:
Loyalty works best when it feels like genuine value rather than a points scheme nobody uses. That’s the standard customers are measuring financial services businesses against right now.
The common thread running through all ten of these trends is the same: customers have more choice, higher expectations, and less patience for experiences that don’t feel relevant to them.
The financial services businesses responding well to that shift aren’t necessarily the biggest. They’re the ones using data intelligently, investing in the right technology, and building loyalty programmes that give customers a genuine reason to stay.
If you’re thinking about how loyalty fits into your growth strategy, Propello Cloud helps financial services businesses build and manage reward programmes that drive real retention. Get in touch to find out more.
The digital transformation in financial services is driven by mobile apps, AI, and fintech innovations, challenging traditional commercial banks and investment banks. Rising interest rates and regulatory requirements also push institutions to adopt new technologies to improve their bottom line.
Financial institutions leverage data-driven insights to personalise services, optimise processes, and manage risk, enhancing customer support. This includes using AI and generative AI to analyse customer data, ensuring customers feel valued, and boosting brand loyalty and repeat purchases.
Open banking allows third-party developers to access financial data via APIs, promoting innovation. Customers feel empowered by personalised services, while commercial banks and insurance companies benefit from improved financial systems, enhancing their bottom line and meeting regulatory requirements.
Financial services in 2024 will face increased regulatory requirements, including ESG and consumer protection standards. Central banks enforce stricter compliance to ensure economic growth and stability. Institutions must adapt their operations to maintain trust and avoid penalties from high-level regulators.
Financial services businesses focus on social responsibility, offering green finance products, and supporting ethical causes. Insurance companies and commercial banks are integrating ESG factors into their operations, aligning with customers’ values, and contributing to broader sustainability goals.
Financial institutions implement robust security measures like multi-factor authentication and proactive vulnerability management. By prioritising security, they protect sensitive data, ensuring customers feel secure and maintaining trust in financial systems, which is crucial for brand loyalty.
Artificial intelligence (AI) and generative AI are revolutionising financial services by automating tasks, enhancing customer support, and offering personalised experiences. AI-driven insights help investment banks and insurance companies improve operational efficiency, positively impacting the bottom line.
Financial institutions are modernising core infrastructure, moving to cloud-based and API-driven platforms, and using AI to automate back-office tasks like compliance reporting. Many are also choosing outsourced loyalty and technology solutions over in-house development, prioritising speed to market and scalability over building everything themselves.
Financial services businesses are investing in mobile-first design, real-time rewards, and experiential perks to meet rising customer expectations. Personalisation is the biggest opportunity area. Leveraging AI to personalise interactions boosts customer satisfaction, encouraging brand loyalty and repeat purchases in a competitive market.
Financial institutions use data analytics to personalise customer interactions, promoting trust and brand loyalty. They offer rewards programmes with incentives for repeat purchases to give customers value. High-level customer support and innovative services also play crucial roles in retaining clients.
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