Community Banking Market Report 2025

The community banking market size has grown strongly in recent years. It will grow from $17.79 billion in 2024 to $19.39 billion in 2025 at a compound annual growth rate (CAGR) of 9%. The growth during the historic period can be attributed to increasing local economic development, rising demand for relationship-based banking, growing trust in local institutions, dissatisfaction with large national banks, and the heightened importance of community reinvestment.

The community banking market size is expected to see strong growth in the next few years. It will grow to $26.98 billion in 2029 at a compound annual growth rate (CAGR) of 8.6%. The growth projected for the forecast period can be linked to rising adoption of digital banking by small banks, increasing demand for personalized financial services, growth in the number of small and medium enterprises, expansion of community-focused lending programs, and greater use of fintech partnerships. Key trends expected in the forecast period include advancements in mobile and online banking platforms, innovations in customer relationship management tools, integration of fintech solutions with legacy systems, progress in data analytics for credit assessment, and incorporation of artificial intelligence (AI) for personalized banking.

The rising adoption of advanced technologies is expected to drive growth in the community banking market. Advanced technologies include digital tools and platforms designed to improve customer experience, streamline operations, and enhance the delivery of financial services. Their growing use is fueled by increasing consumer demand for fast, convenient, and personalized digital banking options. In community banking, these technologies support the creation of secure digital platforms, enabling personalized services and smooth transactions. They also help optimize operational efficiency and ensure regulatory compliance, contributing to greater financial inclusion within local communities. For example, in November 2024, the Bank of England reported that 75% of firms had already integrated artificial intelligence (AI) into their operations, with an additional 10% expected to adopt AI within the next three years. As a result, the increasing use of advanced technologies is contributing to the growth of the community banking market.

Companies in the community banking market are increasingly focusing on implementing digital banking platforms to improve efficiency, enhance customer experience, and stay competitive in a digital-first financial environment. A digital banking platform is an integrated software solution that allows banks to deliver services such as account management, payments, and loan processing through online and mobile channels in a secure and intuitive interface. For instance, in April 2025, Finovif, a U.S.-based fintech firm, launched a digital banking platform specifically for community banks. This modern solution offers seamless integration with existing core banking systems and includes features such as real-time transaction processing, mobile access, personalized financial insights, and automated compliance tools. The platform enables community banks to compete effectively with larger institutions without requiring major infrastructure investments.

In May 2023, JPMorgan Chase & Co., a U.S.-based financial services provider, acquired a substantial majority of assets and certain liabilities of First Republic Bank from the Federal Deposit Insurance Corporation for an undisclosed amount. The acquisition is intended to strengthen JPMorgan Chase’s capital position, broaden its service capabilities, and further its goal of becoming the leading financial services provider in the United States. First Republic Bank is a U.S.-based financial institution that incorporates community banking elements in its operations.

Major players in the community banking market are Citizens Financial Group Inc., Synovus Financial Corp., Wintrust Financial Corporation, Pinnacle Financial Partners, Bank OZK, Associated Banc-Corp, Bendigo and Adelaide Bank Limited, Fulton Financial Corporation, Customers Bancorp Inc., Independent Bank Corporation, Park National Corporation, Coastal Financial Corporation, Dime Community Bancshares Inc., Community Trust Bancorp Inc., Beyond Bank Australia Ltd, Coöperatieve Rabobank U.A., Summit Financial Group Inc., Sound Financial Bancorp Inc., Hometown Community Bancorp Inc., Flint Community Bank, Greenwood Bancshares Inc.

North America was the largest region in the community banking market in 2024. Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in community banking report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East and Africa. The countries covered in the community banking market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

Note that the outlook for this market is being affected by rapid changes in trade relations and tariffs globally. The report will be updated prior to delivery to reflect the latest status, including revised forecasts and quantified impact analysis. The report’s recommendations and conclusions sections will be updated to give strategies for entities dealing with the fast-moving international environment.

The rapid escalation of U.S. tariffs and the resulting trade tensions in spring 2025 are significantly impacting the financial sector, particularly in investment strategies and risk management. Heightened tariffs have fueled market volatility, prompting cautious behavior among institutional investors and increasing demand for hedging instruments. Banks and asset managers are facing higher costs associated with cross-border transactions, as tariffs disrupt global supply chains and dampen corporate earnings, key drivers of equity market performance. Insurance companies, meanwhile, are grappling with increased claims risks tied to supply chain disruptions and trade-related business losses. Additionally, reduced consumer spending and weakened export demand are constraining credit growth and investment appetite. The sector must now prioritize diversification, digital transformation, and robust scenario planning to navigate the heightened economic uncertainty and protect profitability.

Community banking refers to a type of banking service offered by locally owned and operated financial institutions that prioritize the needs of individuals, small businesses, and organizations within a particular community or region. These banks emphasize building strong personal relationships with their customers and often make lending decisions based on local knowledge and trust, rather than relying solely on credit scores or automated systems.

The main service categories of community banking include retail banking, business banking, wealth management and advisory, and digital banking services. Retail banking involves providing services such as savings accounts, personal loans, mortgages, and payment solutions directly to individual consumers. Community banking incorporates various technology integrations, including core banking systems, financial analytics platforms, mobile payment systems, and artificial intelligence. The target audience includes individuals, small businesses, non-profit organizations, and community groups. The types of institutions involved in community banking include credit unions, local savings banks, and community development banks, serving sectors such as healthcare, construction, transportation and logistics, media and entertainment, and others.

The community banking market research report is one of a series of new reports that provides community banking market statistics, including the community banking industry global market size, regional shares, competitors with the community banking market share, detailed community banking market segments, market trends, and opportunities, and any further data you may need to thrive in the community banking industry. This community banking market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenarios of the industry.

The community banking market includes revenues earned by entities through deposit services, mortgage lending services, credit and debit card services, foreign exchange, and wire transfers. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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