According to Gartner Inc., Indian banking and securities companies will spend Rs 416 billion on IT products and services in 2013, a 12 per cent increase over Rs 370 billion spent in 2012. 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 Rs 122 billion in 2013. However, due to a strong focus on the financial services sector by IT services providers, it is growing and is forecast to overtake telecommunications in terms of total size in 2014.
However, software is forecast to achieve the highest growth rate amongst the top level IT spending categories ? to exceed 18 per cent in 2013, with growth of 23.6 per cent predicted for desktop software and 22.6 per cent for enterprise resource planning (ERP)/supply chain management (SCM)/customer relationship management (CRM), with CRM and other front-office applications high on the agenda.
Commenting on the findings, Vittorio D?Orazio, research director at Gartner said, ?Most banks see expansion and increasing market share as their main priority. As in other emerging markets, the front office gets preference over the back office in major investments.?
?Modernisation 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 modernisation and replacement,? he added.
