To help make sense of what’s coming next, ABA’s subject‑matter experts offer their perspective on the trends that will define 2026 and what they mean for banks right now. They highlight where customer needs are going, where compliance expectations are changing and where opportunities are emerging for banks to lead with clarity, trust and innovation.
Together, these themes form a roadmap for navigating a year that will challenge institutions to adapt quickly while staying grounded in their foundational strengths.
The rise of tokenization
Brooke Ybarra, SVP innovation and strategy
While there’s still plenty of hype surrounding stablecoins and questions about how adoption will grow, the bigger story is why customers might choose to use tokenized money in the first place. Tokenization — essentially, the process of converting ownership of an asset into a digital token that’s represented on a blockchain — changes how assets and liabilities are recorded, stored and moved. In essence, tokenization represents a new layer of financial infrastructure built on blockchain rails. Functional advantages include 24/7 availability that enables transactions outside traditional banking hours; instant settlement that gives customers real time finality; and programmability, allowing smart contracts and embedded logic to automate how money moves.
For banks, the opportunity lies in looking past the terminology and focusing on customer needs. Even if customers aren’t asking for tokenized deposits or stablecoins, they will increasingly expect the underlying capabilities: moving funds on a Sunday, settling payments instantly, triggering transfers based on milestones, or improving liquidity. Banks should assess where these functionalities could reduce friction and add value across payment flows. As tokenization scales across capital markets and banking, understanding the benefits behind the buzz will be essential.
Navigating shifting climate and state pressures
Joseph Pigg, SVP and counsel, sustainable finance and mortgage policy
Mike Gullette, SVP, tax and accounting
As with all presidential administration changes, the regulatory approach to climate and sustainability has changed over the past year. Efforts by the Biden administration to pursue a “whole of government” approach to climate have been curtailed by the Trump administration, which has withdrawn the U.S. from the Paris Climate Accord, and pulled climate guidance from the federal banking regulators, among other actions.
TrendTalks is a new ABA-led webinar series focusing on important banking innovations and smart ideas. Also new: 100 short, curated digital demos from trusted ABA Partner Network companies, with plenty of real-world examples of how solutions are being applied across the industry. Check out both here.
Left leaning states are not the only ones in this game. We continue to see state laws proposed taking aim at perceived “debanking” where a bank can be accused of refusing to serve certain borrowers or industries. These efforts place banks in the uncomfortable position of navigating swings in expectations from regulators; compliance costs with new disclosure requirements, and legal headaches arising from doing nothing more than following business plans intended to provide the best service to their communities, customers and shareholders.
ABA’s advocacy seeks to address these pressures — supporting the withdrawal of burdensome guidance and examination at the federal level; coordinating at the state level to ensure that disclosures are reasonable and provide meaningful information; and pushing back against anti-free market efforts seeking to replace business judgement with government mandates.
The year faster payments finally hits scale
Stephen Kenneally, SVP, payments
This is truly the year for faster payments because of the groundwork that has been laid and the infrastructure in place. While digital assets continue to draw attention, the more immediate opportunity lies in the tools banks already have today. Some of the aspects of crypto that appeal to people — it’s fast, it’s cheap — are things that most banks have now, just packaged differently.
Zelle remains a powerful, bank‑centric P2P network, yet thousands of institutions still haven’t adopted it. Same‑day ACH also offers meaningful speed improvements for everyday use cases – such as helping a customer make a bill payment in time to avoid service interruption. These are capabilities banks can launch right away. For customers looking for instant payments and irrevocable settlement, the solution could be FedNow or the Clearing House’s Real Time Payment network. More banks are adopting these services, and RTP already is processing more than one million transactions per day.
The broader instant‑payment environment is also gaining real traction. Banks should take a close look at customer activity: transactions flowing to PayPal, Venmo or other nonbank services signal clear demand for speed and convenience. For many banks, adopting Zelle is the most immediate step to keep those payments within their perimeter and give customers an experience that feels real‑time. By engaging core providers and understanding onboarding requirements, institutions can position themselves to take full advantage of the faster payments momentum building in 2026.
Rethinking identity in a fully digital world
Patrick Smith, SVP, fraud operations
Advances in technology have increased the ability to commit fraud to open accounts, and as more consumers onboard digitally, banks are losing the ability to rely on the in‑person cues and live interactions that once helped validate identity. Advances in technology — the same ones powering more sophisticated AI‑driven fraud — have made it easier for bad actors to impersonate real customers or automate account‑opening attacks at scale.
Previously effective controls, where banks had live interactions with individuals, are no longer effective. As they face the threats involved with online account openings, banks cannot simply leverage what they had before and try to make it look digital. Increasingly, banks are turning to specialized solution providers to strengthen their defenses, recognizing that no institution can manage the growing complexity of digital fraud independently.
The path forward involves layering controls specifically designed for digital channels and staying aligned with emerging technology trends — particularly as AI‑enabled fraud becomes more sophisticated. By partnering with trusted partners and modernizing their onboarding controls, banks can better manage risk as digital account opening continues to expand in 2026.
Preparing for the malicious use of AI
John Carlson, SVP, cybersecurity regulation and resilience
The malicious use of generative AI poses a threat to financial institutions’ identity proofing and authentication systems — in large part because genAI tools dramatically lower the barrier for creating convincing synthetic identities and sophisticated attacks. Attackers commit fraud through a variety of channels, including deepfakes of videos, voices, and images and phishing emails that are indistinguishable to human perception.
ABA partnered with the Better Identity Coalition and the Financial Services Sector Coordinating Council to produce two papers that: Highlight current and emerging attack vectors powered by genAI and outline potential mitigations that FIs can deploy to guard against each of them Propose 20 distinct actions for policymakers and regulators that would collectively help banks defend against current and emerging attacks powered by genAI that target bank identity and authentication systems.
So … an SSO?
Ryan T. Miller, VP and senior counsel, innovation policy
AI buzz has been in overdrive for the last several years, and many bankers are by now sold on the benefits of the technology. However, adopting AI is not as easy as making a decision and then executing. Most AI tools are developed by third parties as part of their product and service offerings, which are then contracted by the bank. Financial institutions, as highly regulated entities, are required to engage in a thorough due diligence process. This due diligence requires an understanding and mitigation of various risks, which can be cumbersome for both the bank as well as the third party. Oftentimes, the companies end up talking past one another, or they aren’t even sure what examiners will be looking for.
One potential solution would be some sort of agency deference for an industry-led standard setting organization. SSO participants could include frontier model developers, service providers, banks, trade associations, academia and more acting in common cause. The SSO could provide a baseline of validation that would meet regulatory and risk management expectations, such as: disclosure templates for data provenance and model vetting that does not require the transfer of confidential commercial information; certifications of compliance with fairness, transparency, and explainability; and a common lexicon of terms. The SSO would be best suited for community and regional banks, since larger banks would likely want to go beyond given their crucial role in the broader financial system.
The concepts underpinning an SSO have broad support among industry and, at least conceptually, the government. But in order for the idea to take off, it needs joint action from prudential regulators (the Federal Reserve, the Office of the Comptroller of the Currency, and the Federal Deposit Insurance Corporation). Even a gesture as simple as a request for information would go a long way towards establishing a solid foundation. If such an idea moves forward, it would certainly rank among the most momentous regulatory developments of 2026.
Strategically scaling AI
Ryan Jackson, VP, innovation strategy
The primary objective for bank-led AI in 2025 is measurable ROI. While initial efforts focused on broad operational efficiencies and expense reduction, the coming year will be defined by specialization. We are moving past general-purpose models (e.g. Claude, Gemini, ChaptGPT) toward “verticalized” AI — systems specifically trained on banking terminology, regulatory frameworks and niche use cases that name-brand models often miss.
For banks, this means a shift from skepticism to strategic scaling. To stay competitive, institutions should prioritize investments in domain-specific products that offer tangible returns within the next 18 months. Rather than waiting for a “perfect” general solution, banks must act now by refining their data foundations and deploying targeted AI tools that address specific high-friction workflows like onboarding and commercial lending.
Regulatory buildout led by stablecoin
Kaye Lynch-Sparks, senior director and counsel, innovation strategy
The Genius Act established the first comprehensive federal framework for payment stablecoins in July of 2025. The statute sets the lines and goal posts on the field, but the rules of the game will be defined through forthcoming rulemakings. Although few proposed rules have been released for public comment, federal regulators must finalize rules across more than 10 distinct areas by July 18, 2026. These rulemakings will address issuer application and approval processes, standards for evaluating state-level certification regimes, capital and liquidity requirements, and AML/CFT and sanctions compliance among other things. For bank technology providers, this creates a defined but evolving compliance state of play that will influence product design, onboarding workflows, monitoring systems, and reporting capabilities over the next year.
Looking ahead, the Genius Act addresses only one piece of the broader digital asset ecosystem. Additional market structure legislation is still needed to clarify regulatory authority and rules for other digital asset activities, including trading, custody, and intermediaries. While this remains a stated priority for both Congress and the Trump administration, there is no clear legislative timeline. At the same time, policymakers are continuing to explore tokenized deposits, which could introduce distinct regulatory and technological considerations for banks and their vendors. Taken together, these developments point to a significant regulatory build-out for blockchain based finance, with stablecoins leading the way.
National bank preemption and chartering
Dale Baker, VP, trust policy
Two issues stand out: national bank preemption and the OCC’s decisions regarding a host of national bank charter applicants focused on providing digital‑asset‑related activities.
Recent state initiatives — and court decisions such as the one out of Illinois — highlight the growing risk of a patchwork of state laws that conflict with long‑standing federal standards. A uniform national framework has been central to the dual banking system for more than 160 years, ensuring that banks can operate efficiently across state lines and provide consistent services to customers. In this environment, banks should maintain engagement with ABA and state associations to stay closely informed about state‑level developments and better understand what operational changes might be required if adverse rulings stand.
Separately, the OCC’s recent conditional approvals of several digital‑asset‑focused applicants raises a lot of concerns. The regulatory frameworks that will ultimately apply to a lot of these entities are not fully formed, and there’s the potential that some entities may leverage OCC chartering in an attempt to skirt other regulatory responsibilities. ABA has encouraged OCC to ensure that robust, broadly applicable safety and soundness standards are well understood and upheld during this period of rapid innovation and has encouraged OCC to increase transparency throughout its chartering application and approval processes.=
Calibrating bank supervision and regulating payment stablecoins
Hallee Morgan, VP and senior counsel, regulatory compliance and policy
Regulators will continue to recalibrate bank supervision in 2026. Prudential bank regulators will implement supervisory revisions made or proposed in the last year, including: eliminating reputational risk, focusing on material financial risks and reforming supervisory appeals. They are expected to continue recalibrating bank supervision to be less prescriptive and more principles-based.
Bankers should evaluate policies and procedures to ensure the bank is achieving the principles of applicable laws. The CFPB is expected to begin initiating new examinations in 2026, reflecting supervisory priorities including: reducing the number of examinations (especially if they overlap with other state and federal regulators), redressing tangible harm to identifiable consumers (especially service members), focusing fair lending scrutiny on intentional discrimination, and eschewing novel legal theories. Bankers should evaluate compliance through federal and state lenses simultaneously.
Financial institutions and regulators will have to grapple with the consumer-facing aspects of payment stablecoins when implementing the recently enacted Genius Act and the expected enactment of legislation governing stablecoin market structure. Among the questions to be resolved are whether the Electronic Funds Transfer Act and its implementing Regulation E apply to payment stablecoins, and if so, how liabilities and error resolution obligations will be allocated among the various actors in the complex and still-developing stablecoin market.
Innovating commercial lending workflows through modern technology
Sharon Whitaker, VP, CRE and mortgage finance
Across conversations with leading institutions, it’s clear that banks are accelerating adoption of modern technology to streamline commercial lending workflows in 2026. Whether in commercial real estate, commercial and industrial or small business portfolios, legacy processes can no longer keep pace with today’s demands. Modernization is becoming essential to strengthen credit risk management for what is often the bank’s largest and most complex asset class.
Banks are increasingly focused on transforming outdated systems and re-engineering loan processes through enhanced commercial loan origination platforms. AI enabled tools are emerging as a critical component of this shift, providing deeper insight and stronger oversight across the full credit lifecycle. Streamlined workflows — covering underwriting, pipeline management, closing requirements, and ongoing post closing activities — are now viewed as foundational to effective credit risk governance. Modern loan origination systems offer end-to-end modules that manage credit from application through the life of the loan. As institutions rethink their technology stacks, they are prioritizing solutions that support annual reviews, renewals, credit risk ratings, risk reporting and covenant tracking. Evaluating these capabilities is essential for building more efficient processes that support credit analysts, loan officers, portfolio managers, and credit administrators. Identifying the right tools and system enhancements will be key to ensuring the institution maintains strong, defensible credit risk practices in an increasingly complex lending environment.
Three forces reshaping mortgage banking
Rod Alba, SVP, mortgage finance and regulatory counsel
In the past several months, bank mortgage operations have struggled with the dual impact of high interest rates and constrained housing supply. As these pressures subside, mortgage finance will be defined by three different powerful forces. First, artificial intelligence is set to transform both origination and servicing, and experts opine it will deliver efficiency gains that could add to industry margins. Importantly, AI is not replacing mortgage operation teams – it is enhancing them. Lenders are using AI to automate document reviews, risk monitoring, and regulatory text analysis, while regulators continue to stress that human judgment and oversight remain essential.
Second, and related to the above, origination markets are seeing changing business models, often driven by technology, that introduce new market approaches. Note the rise of more precise methods that allow for accurate borrower segmentation and better consumer matching to preferred products. Traditional banks are increasingly faced with the competitive dynamics of integrated real estate–mortgage platforms and data driven consumer ecosystems. Staying competitive will be of top importance.
Finally, new administration policies renew the promise to streamline and improve regulations to lower production costs and allow institutions to redirect time and capital toward automation, consumer experience, and more accurate credit risk evaluation. Costs to originate mortgages have ballooned by 60% or more over the past decade and community banks need burden reductions to enhance business viability and overall resilience of the housing finance system.
Building wealth through small steps
Kelsey Havemann, director, youth financial education, ABA Foundation
Building wealth is emerging as a popular topic, with new options for newborns, and Gen Z and adults of all ages trying to make sense of their financial futures. Wealth building encompasses more than complex investing. It starts with an individual understanding their financial picture, paying down high‑interest debt and saving even a small amount, such as $10 a week, to get ahead of unexpected expenses. The message is universal: start small and start now.
For banks, the conversations around financial stability mean there are opportunities to increase education, trust and community presence. Customers need reliable guidance from trusted experts, not generic advice from online influencers. Banks are responding by offering resources on managing debt, hosting workshops in branch education spaces, and creating welcoming environments, from family‑friendly areas to community rooms that invite people in. These touchpoints help frontline staff build relationships and support customers through the small, confidence‑building steps that form the base of long‑term wealth. Banks can make a meaningful impact by meeting people where they are and helping them build wealth, one small step at a time.
Will more banks pursue a regulator-approved CRA strategic plan?
Krista Shonk, SVP and senior counsel, regulatory compliance and policy (and below)
In 2026, I will be watching whether the OCC finalizes its proposed simplified Community Reinvestment Act (CRA) strategic plan process — and whether more banks choose to be evaluated under option instead of the standard CRA performance tests. The proposal would make the strategic plan path more accessible for banks up to $30 billion in assets, which is important as community banks expand into fintech partnerships and niche lending strategies that do not fit neatly into the traditional CRA framework.
A strategic plan enables banks to set tailored, regulator‑approved CRA performance measures upfront, reducing uncertainty about what qualifies as sufficient CRA activity. With only 16 OCC-regulated banks currently operating under approved plans, the guidance could remove longstanding barriers to strategic plan adoption and allow more banks to benefit from the certainty and flexibility that strategic plans provide.
Will regulators embrace consensus‑driven third‑party due diligence standards?
Among the issues worth watching is whether regulators will participate in the development of consensus‑driven standards for third‑party due diligence beginning to take shape across the industry. Banks depend on outside providers for critical functions — including fraud detection, cloud services, data aggregation and AI‑enabled tools. These relationships offer important benefits but also create onboarding and oversight challenges when banks cannot obtain the information they need to assess and manage third-party risk.
Consensus‑driven, industry‑led standards could establish transparent expectations for system design, data controls, security, performance monitoring, and regulatory compliance. If regulators participate in shaping and encouraging adoption of performance standards for third parties, they could bring needed clarity, consistency, and efficiency to third‑party risk management in 2026.
Customer engagement through investment and insurance distribution
Kevin McKechnie, executive director, ABA HSA Council
Strategies to enhance engagement start with deepening client relationships and increasing loyalty. If your bank doesn’t provide robust investment and insurance solutions, your clients will find them elsewhere — because they have to. And when they do, the institutions offering those services will work quickly to move your clients’ remaining assets out of your bank and into theirs.
ABA has made it easy to partner with investment and insurance services companies to help stem this capital drain. No matter how wealthy your clients are, they share six core needs: savings/liquidity, credit, income now, income later, protection and legacy. To attract and retain assets, banks must find ways to serve as many of these needs as possible. Research shows a direct correlation between the number of needs you meet and your share of a client’s wallet.
Consider that nearly 60% of households hold some type of investment account, yet banks penetrate only 4% of those accounts within their own customer base. That means roughly 56% of customers maintain investment relationships elsewhere – assets that slip away to other financial managers. ABA’s Office of Insurance Advocacy, together with the Financial Institutions Insurance Council, has published The Unclaimed Frontier, a practical guide for banks exploring insurance product distribution and seeking to capture more of the value they’re currently leaving on the table.
More trends taking shape in 2026
On the horizon: the ongoing fight against scams, persistent check fraud, fair lending and more. Get an even deeper dive from ABA’s subject-matter experts on what’s top of mind for 2026 in the TrendTalks webinar series starting March 2. Also new: 100 short, curated digital demos from trusted ABA Partner Network companies. These on-demand demos give your team practical, real-world examples of how solutions are being applied across the industry.
