Growth Predicted in Retail Banking Spending
Financial institutions across the world will be spending $132 billion on retail banking technology five years from now, an increase of 24% from current levels, according to Ovum.
The need to grow revenue and improve consumer trust will lead to accelerated investment particularly in online and mobile banking, channel integration, emerging markets and branch technology, the analysis division of London-based Datamonitor said.
Internet-access banking services alone will grow 33% by 2015, to $9.7 billion, Ovum said. "There is a strong focus on online platforms and their extension onto mobile devices and tablets, given their ability to service clients at a lower cost. In addition, technologies that allow 'smarter' selling and servicing, such as customer analytics and channel integration, are expected to remain hot spot areas in the near future," said senior analyst Jaroslaw Knapik.
He said growing compliance costs also will drive investment in tools that increase efficiencies, such as data management, business intelligence and analytics, as well as risk management and anti-fraud tools, accounting for a predicted $7.2 billion in global spend by 2015.
Investment in branch technology in less-saturated markets will result in a 49% spending growth in emerging Asia Pacific markets and 36% in the Middle East and Africa, to $12.7 billion and $5.5 billion, respectively, Ovum said.
Overall retail banking technology spending in the highly developed Western Europe and North American markets, meanwhile, will rise 19% to $40.1 billion and 23% to $50.2 billion, respectively, between 2010 and 2015, Ovum said.