Trump's Tariffs in Financial Services: The Age of Uncertainty

This report outlines why we expect a potentially significant impact for tariffs on FS providers via a slowdown in economic activity and sustained conditions of uncertainty, which will render traditional modes of planning and strategy less effective. We provide a sector-specific view across banking, wealth management, payments, and insurance-sharing likely near- and medium-term impacts as well as firm-level recommendations to mitigate tariff impact.

In the first 100 days of his second presidency, Donald Trump blew up eight decades of global trade rules with the imposition of a 10% global baseline and a "reciprocal" tariff framework, plus sizable tariffs on strategic sectors. These measures disrupted global supply chains, decimated stock markets, devastated consumer sentiment, and created significant uncertainty for businesses across the world, underlining a "new normal in world affairs-the Age of Uncertainty. Although tariffs are largely confined to manufactured goods, we anticipate significant financial services impact.

Scope

• 55% of respondents in our executives surveys are "very concerned" about the impact of tariffs, yet a sizable minority (23%) are "not concerned at all."
• Celent predicts a 1.2% reduction in back tech spend growth in 2025 attributable to tariffs.
• As per GlobalData's Global Customer Acquisition and Retention Analytics 2024, 24% of Generation Z and millennial consumers would prefer to invest with a digital-only bank or digital investment platform over a traditional bank or building society. This represents a significant opportunity for digital challengers to entice new or novice investors to capitalize on lower asset prices.

Reasons to Buy

• Review how Trump's tariffs have evolved since "Liberation Day", and the primary transmission mechanisms that threaten to drive potentially significant impacts for FS consumers, their providers, and the technology partners that work with them.
• Identify key sector-specific impacts across banking, wealth management, payments, and insurance (including revised product-level and tech spend-level forecasts) to help quantify potential impact.
• Learn which strategies can mitigate tariffs impact, including which initiatives are most closely aligned to pre-existing transformation imperatives, and where judicious use of "net new" strategies may work well.