IT spending in Asia-Pacific by the wealth management industry will top $4.6 billion (approximately Rs 20,500 cr) by 2015, a significant growth rate of 8% over a five year period starting 2011, according to a forecast by an independent technology analyst, Ovum.
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In Asia-Pacific, China and India will be the major driver in IT spending with a CAGR of 14% and 12.5% respectively compared to 8% in Australia and 7% in Korea.
Jaroslaw Knapik, senior analyst, Ovum, says: “The recession had a big impact on the wealth management industry and it was one of the sectors that bore the brunt of the fall-out, resulting in growth in IT spending slowing considerably.
“With recovery now under way, the outlook for IT spending is much more positive. Strong growth in the Asia-Pacific market, a need to invest in channels such as internet services, and compliance requirements of new regulations such as Basel III, are all fuelling Asian growth in technology investment.”
All channels will see an impressive growth; however, this increase will be stronger in the internet services. Knapik adds: “The need to create websites and applications that allow customers and financial advisors access to company websites via mobile devices such as smartphones and tablets will drive some of this growth in internet spend. Much of the rest will come from upgrading online services with personal financial management tools and closer integration of the online channel with middle and back office technology such as product origination, customer information or investment and portfolio management systems.
“While the amount of money spent on IT will be greater in the developed world, emerging Asia-Pacific market is set for explosive growth in the next five years.”