Deloitte report: China to drive regional growth as Asia Pacific financial services industry targets US$4.8 trillion in economic value by 2035

China will continue to lead Asia Pacific's financial services through scale, driving the region toward a projected US$4.8 trillion in economic value added by 2035, according to Deloitte's latest report From growth to advantage: Competing for the future of financial services in Asia Pacific.

Asia Pacific's broader economy is expected to expand to nearly US$54 trillion by 2030, representing growth of 37% from 2024, ahead of Europe (36%) and North America (29%). This puts the region at the centre of global financial services growth, with a structurally stronger trajectory than other major markets.

"Over the next decade, many of the most important decisions on capital, payments, digital assets, artificial intelligence (AI) and financial infrastructure will be made in Asia Pacific," said Stuart Johnston, Deloitte Asia Pacific's Financial Services Leader.

"The region has the scale, savings, innovation and talent to shape the next era of global finance. But the prize is not assured. Leadership will depend on whether institutions can connect funding with opportunity, win more demanding customers, and use AI to build sustainable advantage."

China's growing influence through market scale and capital deployment

With projected Compound Annual Growth Rates (CAGR) of 6.1% for the Chinese mainland and 5.1% for Hong Kong through 2035, both markets anchor Asia Pacific's financial services value-added expansion in the long run.

Hong Kong, as the third-ranked global financial centre, has also become the world's biggest cross-boundary wealth management centre. Home to over 3,300 family offices, the city is uniquely positioned to capture this monumental "Great Wealth Transfer", as more than US$10 trillion of personal wealth is expected to be transferred within and between generations across Asia Pacific over the next 20 to 25 years.

"Asia Pacific's growth story is accelerating, and Hong Kong remains at its centre, connecting capital, markets and opportunities across the region. Beyond growing in scale, the city is setting new standards for how funds are raised and moved across borders by attracting family offices, expanding cross-border wealth connect schemes, and pioneering innovation in tokenization and digital assets," said David Wai Kit Wu, Deloitte China Financial Services Industry Hong Kong Leader.  

"Through innovation-led regulatory approaches, Hong Kong is positioning itself as a global leader in financial innovation, market integrity and regulatory quality. As technology becomes a differentiator in financial services, we continue to see investment in new business models that turn innovation into competitive advantage that will determine who wins in the next decade."

The Chinese mainland's vast market scale, backed by Asia's largest equity market of US$15.5 trillion and the world's second-largest bond market, is reconfiguring financial flows across the region. Meanwhile, the country's cross‑border financial architecture is emerging at pace, with its Cross‑Border Interbank Payment System reaching more than 1,700 participants in 189 countries.

"Despite being home to some of the world's largest banks and insurers, China mainland's financial institutions remain relatively domestically focused. Even so, China is already a system‑shaping force and its influence on trade, financial flows, payments infrastructure and financial standards must be reflected in the strategy of every financial institution in the region," said Calvin Zeng, Deloitte China Financial Services Industry Banking & Capital Markets Leader.

"Driven by the accelerating RMB internationalization across global payments and trade finance, we expect the Chinese mainland to further align its financial system to promote renminbi-denominated trade. We have also seen increased global capital deployment, with cumulative lending under the Belt and Road Initiative reaching US$1.4 trillion."

Four battlegrounds will define the next decade

The report identifies four competitive battlegrounds that will determine which institutions shape the region’s financial future:

1. Shaping the new financial system: Asia Pacific relies heavily on bank credit (averaging 122% of GDP across 13 major economies) compared to market-based financing (only 53% of GDP). As a net exporter of savings, the region needs broader financing channels beyond banks, deeper capital markets, stronger intra-regional flows and a wider range of funding options to fund a multi-trillion-dollar investment cycle.
   
2. Winning the customer: Demographics, digital adoption, and rising wealth are reshaping financial demand. By 2030, Asia Pacific is expected to add 174 million people and over 362 million middle-income households by 2034. With over 750 million new customers entering the financial system in the past decade, incumbent financial institutions face fierce competition from super-apps, fintechs, and digital banks contesting customer relationships.
3. Navigating the AI inflection: While 66% of Asia Pacific financial institutions report productivity gains from AI, only 18% have achieved a revenue impact. The next competitive advantage will come from redesigning business and operating models around AI, rather than adding AI to existing processes. Proprietary data and strong AI governance will become important sources of differentiation.
4. Engaging the rule makers: Governments and regulators across Asia Pacific are rewriting the rules of financial services as national priorities, AI assurance, cyber risk, and digital assets rise on the agenda. With annual financial crime compliance costs reaching US$45 billion and total regulatory compliance spend exceeding US$150 billion, firms that engage early with policymakers can turn complexity into trust, influence, and competitive advantage.

"The response to uncertainty should not be caution," Stuart Johnston added. "The winners will be those that set a clear direction and execute at pace. Institutions that connect regional savings with investment needs, deepen customer relevance, build distinct AI-enabled capabilities and engage constructively with regulators will be best placed to define the next era of financial services in Asia Pacific."

Click here to read the full report.