The shadow banking market is expected to register a CAGR of 5.2% in 2023–2031. Regulatory changes and the rise in fintech are likely to remain key shadow banking market trends.
Banks are the key functional institutions in the economy. shadow banking systems can be understood as intermediary institutions that function like a banks but are not regulated as a bank is. This type of system consists of various components that fall outside the regulatory realm of traditional banking. These components are brokers, lenders, and other credit intermediaries.
In the past decade or so, the shadow banking secotor has grown manifolds. Advanced economies have the largest shadow banking networks, with narrower measures indicating stagnation and broader measures (including investment funds) showing expansion since the global financial crisis. In developing market nations, shadow banking has grown faster than traditional banks. Shadow banking can complement traditional banking by increasing lending access, improving market liquidity, transforming maturity, and sharing risk.
According to the 2021 FSB (Financial Stability Board) data, the NBFI industry had significant growth owing to increased investment fund values and inflows during the economic recovery period. The NBFI sector increased by 8.9%, exceeding the five-year average of 6.6%. Its percentage of total global financial assets remained unchanged at 49.2%. This drives the demand in the shadow banking market.
Shadow banking systems offer finance alternatives to underrepresented market niches in developing economies. Shadow banking in developing nations like China and India bridges the financing gap in the official financial system by offering alternative financing options to market segments underserved by established banks. This promotes economic growth.
Key segments that contributed to the derivation of the shadow banking market analysis are type and application.
The geographic scope of the shadow banking market report is mainly divided into five regions: North America, Asia Pacific, Europe, Middle East & Africa, and South America/South & Central America.
North America has dominated the shadow banking market. According to the 2023 Federal Reserve Data, the amount that US banks have lent to so-called shadow banks has crossed the $1 trillion mark. Thus, the shadow banking market is undergoing substantial development in North America.
The regional trends and factors influencing the Shadow Banking Market throughout the forecast period have been thoroughly explained by the analysts at Insight Partners. This section also discusses Shadow Banking Market segments and geography across North America, Europe, Asia Pacific, Middle East and Africa, and South and Central America.
| Report Attribute | Details |
|---|---|
| Market size in 2024 | US$ XX million |
| Market Size by 2031 | US$ XX Million |
| Global CAGR (2025 - 2031) | 5.2% |
| Historical Data | 2021-2023 |
| Forecast period | 2025-2031 |
| Segments Covered |
By Type
|
| Regions and Countries Covered | North America
|
| Market leaders and key company profiles |
The Shadow Banking Market market is growing rapidly, driven by increasing end-user demand due to factors such as evolving consumer preferences, technological advancements, and greater awareness of the product's benefits. As demand rises, businesses are expanding their offerings, innovating to meet consumer needs, and capitalizing on emerging trends, which further fuels market growth.
Market players density refers to the distribution of firms or companies operating within a particular market or industry. It indicates how many competitors (market players) are present in a given market space relative to its size or total market value.
Major Companies operating in the Shadow Banking Market are:
Disclaimer: The companies listed above are not ranked in any particular order.
The shadow banking market is evaluated by gathering qualitative and quantitative data post post-primary and secondary research, which includes important corporate publications, association data, and databases. The following is a list of developments in the market for shadow banking and strategies:
The “Shadow Banking Market Size and Forecast (2021–2031)” report provides a detailed analysis of the market covering below areas:
The global shadow banking market is expected to grow at a CAGR of 5.2% during the forecast period 2023 - 2031.
Growth in the NBFI (Non-Bank Financial Intermediation) sector is the major factors that propel the global shadow banking market growth.
Regulatory changes and the rise in Fintech are anticipated to bring new shadow banking market trends in the coming years.
In terms of revenue, the money market funds segment held the major market share in 2023.
The key players holding the majority of shares in the global shadow banking market are UBS Group AG, Standard Chartered PLC, JPMorgan Chase and Co., and Bangkok Bank Public Company Limited.