Financial services sector paves way for rebounding economy

Businesses have been burdened with innumerable headwinds driven by the COVID-19 pandemic. The surge in cases caused demand slumps not seen in decades, as policymakers were forced to compromise between public health and business activities. As most sectors are now seeing glimpses of recovery from the crisis, geopolitical situations continue to jolt economic rebounds. The revival of business depends on the quick implementation of stimulus packages to cause an uptick in business activities. However, it is evident that the financial services (FS) sector will lead the way in recovering from the pandemic, according to GlobalData, a leading data and analytics company.

Rinaldo Pereira, Senior Analyst at GlobalData, says: “Several sectors have continued to be optimistic about economic upturns, as mentions of ‘recovery’ and ‘upswing’ rose by around 24% in companies’ filings between Q1–Q3 2020 compared to the same period last year.”

The FS sector recorded the most ‘recovery’ discussions in 2020. Government actions have softened the pandemic’s impact on the FS sector as several companies were able to reinforce balance sheets. Other companies have emphasized the importance of digital initiatives to continue operations.

Pereira adds: “While online payments continue to soar amid the crisis, earnings transcript mentions of ‘mobile payments’ in the FS sector for 2020 (until September) have already surpassed 2019, with over 34% growth. The e-commerce boom has strongly influenced this trend.”

Vlad Totia, Payments Analyst at GlobalData, comments: “The pandemic has really done a lot to make consumers adopt more digital means of personal finance. In terms of payments, there has been a particular increase in contactless and mobile payment methods as, on the one hand, they present less risk of contracting COVID-19 when buying in a shop by not handling cash as much, and, on the other hand, as people moved more towards online shopping, given how stores had to temporarily close and reduce their activity in order to observe lockdown measures.

“The increase in mobile payments is of particular interest as it is not something new, but it has benefited from people being almost forced to digitize their finances en masse and getting used to it as a more convenient way to pay than carry cash or cards.”

The power and oil & gas (O&G) sectors followed FS in terms of the number of ‘recovery’ mentions. This is amid decimated oil demand as lockdowns caused prices to reach decade lows.

Daniel Rogers, Oil and Gas Analyst at GlobalData, comments: “The gradual recovery in oil and gas prices from the second quarter of the year is encouraging for the sector but prices still remain highly depressed. No immediate recovery is expected as is evident from the futures contracts out into next year. Companies will be optimistic that the bottom has been seen but they will continue to keep budgets tightened and operations slim-lined until conditions recover. An uptick in investment and activity for 2021 can be expected albeit unlikely to the levels that we saw in 2019.”

Media Enquiries

If you are a member of the press or media and require any further information, please get in touch, as we're very happy to help.

DECODED Your daily industry news round-up

This site is registered on as a development site.