Indian banking & securities companies will spend 416 billion rupees on IT products and services in 2013, an increase of more than 12 percent over 2012 revenue of 370 billion rupees, according to Gartner, Inc. This forecast includes spending by financial institutions on internal IT (including personnel), hardware, software, external IT services and telecommunications.
Telecommunications remains the largest overall spending category at 122 billion rupees in 2013, however, due to a strong focus on the financial services sector by IT services providers, it is growing strongly and is forecast to overtake telecommunications in total size in 2014.
However, software is forecast to achieve the highest growth rate amongst the top level IT spending categories – to exceed 18 percent in 2013, with growth of 23.6 percent predicted for desktop software and 22.6 percent for enterprise resource planning (ERP)/supply chain management (SCM)/customer relationship management (CRM), with CRM and other front-office applications high on the agenda.
“Most banks see expansion and increasing market share as their main priority,” said Vittorio D’Orazio, research director at Gartner. “As in other emerging markets, the front office gets preference over the back office in major investments.”
“Modernization and legacy replacement remain major issues for many banks as the gap widens between front-office and back-office services. We see increasing adoption of packages, especially for ‘lite’ core banking systems to address modernization and replacement,” said Mr. D’Orazio.
