Banking trends to watch in 2026

The interconnectedness among several emerging trends in 2026 is noteworthy, with artificial intelligence (AI) and progressive modernisation acting as common threads. 

One trend that will continue gaining momentum throughout 2026 is the shift from customer-first to human-first banking, which aims to get even closer to the customer by understanding their human needs, rather than consumer needs. 

For example, instead of solely advising on which banking products they should buy, a bank can act as a coach to improve a customer’s financial health. In this way, banks will build trust in the digital realm through tailored and empathetic interactions.

To attain that level of hyperpersonalisation, banks will need to be able to process vast amounts of transactional data. This can only be accomplished by deploying AI and big data tools, which will turbocharge progressive modernisation.

Traditional banks are using progressive modernisation to deal with legacy infrastructure that is not fit for purpose in a digital-first, AI-driven world. Instead of a big bang replacement of legacy systems, banks are creating change from within existing architecture and leveraging technologies that support a multi-core strategy. With this approach, banks can continue operating legacy systems while introducing modern platforms that support advanced AI and big-data capabilities - unlocking true hyperpersonalisation.

Fraud threats

Undoubtedly, fraud will remain a top concern in 2026, as adversaries use AI to expand the range of techniques, such as impersonation scams and identity theft, as well as accelerate and scale fraudulent activity.

To combat fraud, new and improved tools to help banks identify, verify and onboard customers will come to market in 2026. The move away from paper-based identity (ID) and widespread adoption of digital ID will play a key role in the fight against fraud.

In addition, I expect to see a fundamental shift in fraud detection using real-time behavioural analytics, data analytics for proactive risk identification, and other applications of AI and machine learning. 

Digital assets and stablecoins

Digital ID verification is also essential for fighting fraud in the digital assets and stablecoins space, which will become much more mainstream in 2026. Banks are now actively engaged, running pilots, etc, such as the nine European banks’ initiative to launch a euro-denominated stablecoin.

With central banks and regulators developing a comprehensive agenda for digital assets, banks will need to blend traditional fiat currencies and assets with their digital counterparts. This trend is also driving a progressive modernisation approach, as legacy core banking systems weren’t designed to manage digital assets, nor do they support moving money via blockchain-based rails. I expect to see more banks looking to deploy a multi-core strategy where digital assets are managed and stored elsewhere, but they can still provide a seamless and unified experience to customers.

GenAI applications

No 2026 prediction piece would be complete without mentioning generative AI (GenAI). In 2025, institutions explored what is possible, relevant and achievable within the banking context, then specifically for each individual institution within its legacy architectures and technological environments. 

This trend will evolve into more practical actions and initiatives over the next 12 months highlighting where GenAI is suitable.

One area where GenAI is applicable is in conversational applications. Banks will begin launching more interactive user interfaces, moving beyond simple, frequently asked questions to actual actions.

Similarly in the back office, banks can leverage GenAI to provide guidance to their employees and accelerate certain tasks. Using the technology to improve efficiency and help staff do more will have a positive impact on customer experience, as processes will take much less time.

It will also help to bring unbanked segments or non-standard customers into regulated financial services. Applying GenAI can make the bespoke process much more efficient by providing data-driven insights to support faster and smarter decision-making. This will make it much cheaper to serve these segments, which will drive financial inclusion and improve customers’ financial health.