BFSI going bullish on Tech Adoption

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Technologies which help them to interact with their customers, or develop unmatched market intelligence are getting popular within India’s BFSI segment.

The failure to respond to changing market realities has stunted the development of the financial sector in many developing countries including India. As seen in many developing geographies, weak banking structure has been unable to fuel continued growth, which has harmed the long-term health of their economies. And hence, the BFSI sector is looking up to the technology side to provide them with market intelligence and means to interact with their customers in a better manner.

The banking sector within India has compared favorably on growth, asset quality and profitability with other regional banks over the last few years. According to the experts close to this sector, the banking index has grown at a compounded annual rate. Policy makers have made some notable changes in policy and regulation to help strengthen this sector. And as a result, India’s BFSI is today looking at incorporating cutting edge technological enhancements in order to do more with less.

However, the cost of intermediation remains high and bank penetration is limited to only a few customer segments and geographies. While bank lending has been a significant driver of GDP growth and employment, periodic instances of the “failure” of some weak banks have often threatened the stability of the system. On the other hand, technology has surely come to the rescue for a number of BFSI organizations.


The bar for what it means to be a successful BFSI player in the sector has been surely raised. However, challenges must be addressed before success can be achieved. First, the market is seeing discontinuous growth driven by new products and services that include opportunities in credit cards, consumer finance and wealth management on the retail side, and in fee-based income and investment banking on the wholesale banking side.

On the technology adoption side, most of the banks use core banking products by leading global vendors. Today’s banks are more receptive to reaching out to their customers taking the help of technology. Communications focused technologies such as Ethernet is playing a important role here.

With increased interest in India, competition from foreign banks will only intensify. And given the demographic shifts resulting from changes in age profile and household income, consumers will increasingly demand enhanced institutional capabilities and service levels from banks. Better technology adoption is the only answer to solve these issues and the BFSI sector has already realized this. Moving forward we are likely to see better tech adoption within the BFSI segment and technologies such as cloud computing or virtualization are set to rule the roost here.