Retail banks turn to IT to drive revenue in 2015
Retail bank IT investment in 2015 will be focused on driving revenue growth, according to new research from Ovum, the global analyst house. Digital channels will be at the heart of this activity, particularly as the improving economy has meant reducing costs and headcount is no longer a priority. The large majority of investment made in 2015 will be focused on progressing with an omnichannel experience for customers.
Across the senior IT executive respondents in Ovum’s ‘ICT Enterprise Insights’ survey, 43% highlighted supporting revenue growth as one of the top three strategic priorities for 2015. In recent years, many banks have neglected the back office to focus on creating a strong consumer-facing platform, therefore improving the efficiency of internal business processes is a core focus for 38% of banks.
“The need to grow top line revenue through sales and customer conversion rates is driving investment into digital channels,” said Kieran Hines, Practice Lead, Financial Services Technology, Ovum. “Due to this, the areas that will see the greatest spending in 2015 are mobile and online banking, with 52% and 51% of banks respectively seeing their budgets grow. Product development will see the largest magnitude of budget increase, with over 17% of banks expecting investment to increase by more than 6%.”
Regionally, North America and North Asia are tightly focused on the consumer, while this is less of a priority in Western Europe. Banks in the US and Canada cited customer origination and customer experience as their two priorities. In North Asia, 58% of banks hold streamlining customer application and management processes as a pressing issue. Reflecting the less positive economic outlook in Western Europe, the leading IT priority for banks in the region is simply to support revenue growth.