IT spending in Indian banking sector to hit $9.1 B: Gartner

Buoyed by the transition of the banking sector into a cashless society, IT spending in the banking and securities firms in India will hit $9.1 billion -- an increase of 11.7 percent -- this year, Gartner said on Monday.

Several top banks in India are investing heavily into contact-less payment that uses near-field communication (NFC) mechanisms, which is also propelling many investments into devices.

Devices spending in the Indian banking sector will grow the fastest at 20 percent in 2017, followed by IT services at 15.8 percent, Gartner said on the first day of its symposium in Goa that will run till November 16.

"Indian banks are getting back on track after slower IT spending the last two quarters, which was prompted by demonetisation," said Moutusi Sau, Principal Research Analyst at Gartner.

"However, as banks focus on enhancing the legacy infrastructure and making digital transformation the primary goals for the banks, we will see more investments flow into newer concepts like artificial intelligence (AI) and blockchain," Sau added.

Firms in the banking and securities industry are investing more in devices to upgrade their existing infrastructure.

"As digital leaders, financial services CIOs need to focus their firms' participation in an expanded ecosystem that includes competitors, customers, regulators and other stakeholders from across multiple industries," noted Rajesh Kandaswamy, Research Director at Gartner.

If one tracks banking, they would know that there has been very little innovation in banking for over 100 years other than the use of computers from the late 60s and to having digital applications in the early part of the 80s. These behemoths are finally admitting that there is a need to partner with young companies to understand the digital evolution.

The banking and securities industry forecast provides total enterprise IT spending for 43 countries within 11 regions. This forecast provides total enterprise IT spending for internal spending and spending data on data center systems, devices, software, IT services and telecom services.