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Indian banking and securities companies will spend Rs 42,200 crore ($422 billion) on IT products and services in 2013 — a 13 per cent rise from Rs 37,300 crore a year ago.
IT services is the largest overall spending category at Rs 13,200 crore in 2013. This confirms the strong focus on the financial services sector by IT service providers, according to a study by research and analyst firm Gartner.
Software is forecast to achieve the highest growth rate among the top-level IT spending categories at about 18 per cent in 2013. The forecast includes spending by financial institutions on internal IT (largely personnel), hardware, software, external IT services and telecommunications.
“The expansion strategy of banks is still paramount in India, as well as in other countries of the APAC region. The Reserve Bank of India is making plans to increase the penetration of banks across the country and even opening up the market to new entrants,” said Gartner Research Director, Vittorio D’Orazio.
“In these cases, the front office technologies for the branch will be very attractive. However, to increase their penetration in India, banks will follow the leverage your customer device (LYCD) trend. This will evolve the relationship between the bank and its customers over the mobile channel without remarkably increasing IT costs. In fact, we see the penetration rates of the smartphone devices in the triple digits range, which is far greater than any branch expansion rate,” D’Orazio said.
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