Banks to spend a fortune on digital re-engineering

Old bankWhile, as we reported earlier, overall IT spending is predicted to decline during 2015, such a phenomenon is not uniform.

IDC said that American banks are expected to spend $16.6 billion on hardware, software, services and IT staff to make everything a lot more digital this year.

And the market analysis firm also predicts that such moves will continue at a compound annual growth rate of 10.4 percent right up until 2019.

The highest growth in spending will be on software and internal IT, while services will be a factor in growth too.

In five years, IDC predicts that one third of the IT budget at US banks will be dedicated to so-called “digital transformation”.

The banks have realised they need to say relevant to their individual and corporate businesses and that’s why they’re ready to splash the cash.

Part of the problem is that there are heavy burdens on the banks for compliance, risk, and security.

But, perhaps surprisingly, banks don’t have a lot of money to spend. But they’re going to spend it.