Global Tech Spending Forecast: Banking Edition, 2016
The sum of bank IT spending across North America, Europe, Asia-Pacific, and Latin America will grow to US$241 billion in 2016. This spending level is 3.9% higher than in 2015. The forecast for last year projected a 4.4% rate of growth for IT spending, indicating that our projection was slightly higher than reality. Spending in 2015 increased 4.6% over 2014. Momentum is positive and consistent, and will continue for the next few years. When we examine the sum of the four regions, IT spending is expected to grow by 4% in 2017 and 4.3% in 2018.
In the report Global Tech Spending Forecast: Banking Edition, 2016, Celent analyzes IT spending trends across North America, Europe, Latin America, and Asia-Pacific. The report compares and contrasts the direction of IT spending trends.
“Both retail and wholesale banking in North America will experience a steady increase in the amount of money spent on technology,” says Stephen Greer, analyst with Celent’s Banking Group and coauthor of the report. “Modernization is taking place at the front, middle, and back, with complex middleware integration to connect systems. As a result, new investment spending is growing at a moderate yet consistent pace as these institutions invest resources into new initiatives.”
“The headline numbers for Europe show that IT spending is expected to grow across all businesses,” says Gareth Lodge, senior analyst with Celent’s Banking Group and coauthor of the report. “However, more countries seem to be faltering in their economic growth. Whilst not in decline, combined with the increasing regulatory burden, many banks are starting to find it tough going, with pressure on both costs and revenue. This will affect overall IT spending growth.”
“Asian banks are facing intense competition,” says Hua Zhang, analyst with Celent’s Banking Group and coauthor of the report. “The banking sector in this region is especially dynamic because of new players (such as Internet firms) and new banking regulations. Asian banks must continue to update their business models to adapt to new regulations and reforms, and employ innovative technologies to deliver maximum protection, value, and satisfaction to their Asian customers.”
“After years of economic growth for many Latin American countries, particularly driven by Brazil and other members of the Pacific Alliance, the region has entered into a new economic, social, and political context,” says Juan Mazzini, senior analyst with Celent’s Banking and Insurance Group and coauthor of the report. “Customer expectations are changing among young, digitally savvy consumers, and the next one to five years will be a watershed period for digital banking.. Banks are working to become more efficient and agile while transforming into the bank of the future. In order to execute their plans banks will continue to invest in IT.”
This report is divided by region (North America, Europe, Latin America, and Asia-Pacific). Each section analyzes the budget allocations according to type of customer and of investment (internal versus external, maintenance versus new). An overview of the top technology trends in each region is also provided.
This 36-page report contains 20 figures and 8 tables.