Indian BFSI set to Grow to $2.7 Billion by 2013

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Banking enterprises are increasing turning towards technology, when it comes to injecting intelligence within the banking systems including BI applications and intelligent fraud detection systems.

The Banking, Financial Services and Insurance (BFSI) IT Services market in India is expected to grow to US$2.7 billion by 2013, growing at a CAGR (compound annual growth rate) of 14.2 per cent, says Springboard Research, a provider in the IT Market Research industry.

Market research firm, Springboard's report, "The Indian IT Services Market for the Banking, Financial Services and Insurance Vertical" notes that this competitive market remains fragmented between a large number of services providers.

Today the key challenge for IT vendors is to keep pace with end user demand for rapid innovation. There is a great demand to realize the full potential of customer service levels and BFSI focused enterprises have been rapidly investing in IT to work towards fulfillment of this objective.

With increasing competitive pressure, it is getting harder for BFSI enterprises to continuously win and keep their set of customers, hence they are moving towards better and intelligent CRM solutions. The move to adopt CRM solutions and customer focused technology is driven by the increasing need for maintaining and enhancing customer relationships.

Business Intelligence (BI) is yet another key priority for BFSI enterprises which helps to identify and capture potential customers. Financial organizations in India are also using high-end analytics to indentify fraud and money laundering.

The last decade has seen many positive developments in the Indian banking sector. The policy makers, which comprise the Reserve Bank of India (RBI), Ministry of Finance and related government and financial sector regulatory entities, have made several notable efforts to improve regulation in the sector.

The sector now compares favorably with banking sectors in the region on metrics like growth, profitability and non-performing assets (NPAs). A few banks have established an outstanding track record of innovation, growth and value creation. This is reflected in their market valuation as well.

However, the cost of banking intermediation in India is higher and bank penetration is far lower than in other markets. Moving forward, India’s banking industry must strengthen itself significantly if it has to support the modern and vibrant economy which India aspires to be.