According to a report by Springboad Research, the banking, financial services and insurance (BFSI) IT services market in India is expected to grow from US$1.6 billion in 2009 to US$2.7 billion in 2013, growing at a compound annual growth rate (CAGR) of 14.2 per cent.
Market growth is tied with increasing competitiveness and CIOs are making sure their companies are keeping up.
"Although the BFSI vertical in India is maturing in terms of adoption and use of IT, it continues to be price-sensitive. 'Hard to please' Indian CIOs are becoming as demanding as their global counterparts, consistently expecting vendors to offer a 'fresh approach'," said Sanchit Vir Gogia, senior research analyst for services, Springboard. "Now the key challenge for IT vendors moving forward will be to keep pace with end-user demand for rapid innovation," Gogia added.
Applications and solutions
Among the applications in demand by the industry are customer relationship management (CRM) and business intelligence (BI). CRM applications are used to help maintain customers due to increasing competitiveness in the industry. BI, on the other hand, helps organisations identify potential customers.
Springboard also noted that the industry is looking into solutions that will help them identify fraud and money laundering activities. In the next two to three years, the research firm said BI and anti-money laundering solutions would be the key priority among BFSI enterprises. Currently, Indian organisations are already using high-end analytics to identify fraud and money laundering.
Springboard suggests that vendors specify a clearly defined and achievable unique selling proposition for the overall ecosystem.
"The Indian IT services market for BFSI (and overall) is highly competitive with limited top level differentiation. Vendors must now adopt a BFSI-specific template, 'productise' their service offerings to try to maximise the potential for lower price points delivering improved and sustainable margins," advised Phil Hassey, vice president for services at Springboard.