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IT spending set to rise in the retail banking sector
January 23, 2012Industry and economic conditions are coming together to force significant new investments in the retail banking sector. In response, many new IT solutions, ranging from banking-specific technologies to mobile device support will be purchased during 2012, according to a recent Ovum study.
According to the survey, banks in emerging economies are witnessing the fastest growth, as they are experiencing rapid growth and new opportunities for expansion that require technology investments. While the emerging economies of the world will be leading the investment charge, the majority of countries will see significant spending coming from the retail banking sector.
Even Western Europe, which is expected to experience the least growth at just 1.9 percent, will see meaningful expansion. Since the sector is so large, Ovum anticipates spending will rise to more than $44 billion before the end of the year, despite the comparatively slow investment climate.
Jaroslaw Knapik, Ovum financial services analyst, explained that regulatory pressures and the need to create more revenue opportunities are the primary motivators behind increased spending in the global retail banking sector.
"Technologies that allow ‘smarter’ selling and servicing, such as customer analytics and customer data management, are expected to remain hot areas in the near future," said Knapik. "As sales activities are expected to be on the rise again, banks will also boost investments into operations as the ability to sell products faster and service customers better will continue to be a competitive differentiator in the retail market."
The need to drive revenues will lead to significant spending on online banking and other channels that give organizations access to low-cost methods to reach consumers. Mobile banking will be one of the primary beneficiaries of this movement, Knapik explained. He also said underlying infrastructure upgrades could help meet regulatory demands.
Every time a business makes a change to either its operational or customer-facing systems, enables more mobile device usage, or shifts its foundational infrastructure, CMDB systems and IT help desk software come into play. The CMDB is essential in supporting such investments, as the transparency it creates can help organizations deploy the right hardware to meet operational and security needs. The help desk systems come into play once new systems are in place, as they are key to helping users adapt to the new technological environment.