Despite declining forecast on world economic
activity due to the Eurozone crisis, analysts at Ovum are
predicting that IT spending by the global wealth management
industry will reach almost $35bn by 2016, powered by heavy
investment in digital channels.
Between 2011 and 2016 the Asia-Pacific region
will increase its IT spending by a compound annual growth rate to
8.5 percent, a forecast by Ovum.
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China’s investment is also expected to reach
USD$1.78bn, while Japan reaching USD$1.33bn according to global
analysts.
Tech demand
Although banks worldwide are tightening their
budget and scrutinizing new IT expenses, demand for financial
services technology remains strong in the Middle East and the
US.
Jeanne Capachin, vice-president of IDC
Financial Insights, said that in the US for example banks
use “the adoption of public cloud services … as a way to innovate
despite tight IT spending controls”.
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By GlobalDataThe growth in IT spending by wealth management
institutions will give rise to more personal financial management
tools offered to customers.
Increased support for smartphones and tablets
will be driven largely by investment from non-financial
institutions, as well as the recent advances made in mobile finance
platform technology.
Jaroslaw Knapik, a senior financial services
technology analyst at Ovum, forecasts that investment in Internet
and presence technologies by APAC’s high net worth banking and
financial planning businesses will reach USD$150m, while retail
brokerage and retail asset management organisations will increase
their investment to USD$135m and USD$73m, respectively.
Digital progression
Knapik concludes in the Ovum report entitled
‘Wealth Management Technology Spending Through 2016’: “Customer
attitude toward banks has changed greatly as a result of the
financial crisis.
“Increasingly, digital channels are being
developed to improve customer loyalty and cross-selling
opportunities but also to lower servicing costs. While the economy
is recovering, organisations should be focusing on the opportunity
to increase revenue and improve trust among customers.
“This, coupled with the increased investment
in personal finance management tools, will enable more
self-management and closer monitoring of financial assets, helping
to increase overall knowledge of finance management.”
