Despite ongoing economic turmoil, global spending on retail banking technology will increase by $3.6 billion – 3.2% – in 2012, and will hit $135 billion over the next five years, according to analyst house Ovum.
Asia Pacific will lead the way in growth, spending $10.2 billion in 2012, 8.3% up on the previous year. In contrast Western Europe will see the slowest growth, just 1.9%, although it is still the second biggest market, behind North America, spending $44 billion.
Ovum says that much of the spending is being driven by banks’ determination to return to pre-recession revenue levels by investing in channel technology to boost customer trust and increase sales and servicing effectiveness.
Globally, online banking is expected to be the fastest growing area in 2012, with spending rising 5.3% to hit $8.3 billion by year end. Not far behind is the newer channel, mobile, where spending will rise five per cent, reaching $3.3 billion.
Retail banks will invest in these areas in parallel to investments in channel integration and customer information systems, an increase of 4.2% in 2012 globally, hitting $5.6 billion the same year.
These conclusions are similar to recent research conducted by Mercator Advisory Group, which shows great consumer interest in improved banking channels and new ways to conduct business.
Investments in retail banking technology, and particularly banking channels, are clearly areas of opportunity for financial institutions. Both online and mobile banking show great promise as ways for FIs to extend their reach to customers and increase customer satisfaction, all while increasing overall efficiency and productivity.
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