India-based banking and securities companies will spend around US$6.22 billion on IT products and services in 2013, an increase of more than 13% over US$5.5 billion in 2012, according to Gartner. This forecast includes spending by financial institutions on internal IT services (including personnel), software, data center technologies, devices and telecom services.
IT services will be the largest segment in overall spending category at US$1.95 billion in 2013 due to a strong focus on the financial services sector by IT services providers.
Software is the second fastest growth segment, with spending on pace to increase 17.1%, followed by internal services (that includes IT personnel) at 15.7%. In the software segment, desktop software and enterprise resource planning (ERP)/supply chain management (SCM)/customer relationship management (CRM) will exceed the 20% growth landmark with 22.1% and 21.7%, respectively, said Gartner.
"Focus on expansion and increasing market share remains a top priority for banks in India. As in other emerging markets, the front office gets preference over the back office in major investments," said Vittorio D'Orazio, research director at Gartner. "Although we have seen a number of requests from India banks regarding the modernization and legacy replacement of core banking systems, the major issue for many of those banks is still the gap between front-office and back-office services. This explains the growth rate for 2013 in the vertical specific software segment at 17.3%. We also see increasing adoption of packages, especially for 'lite' core banking systems to address modernization and replacement."
Article translated by Alex Wolfgram
