Australian retail banks will spend a total of $US2.38 billion ($2.30 billion) on technology this calendar year in a bid to attract customers and comply with regulatory standards, analyst firm Ovum predicts.
Ovum financial services analyst Jaroslaw Knapik studied the demand for retail banking IT in the Asia-Pacific region, including Central Asia, East Asia and the Pacific.
He expected Australian spending to account for almost a tenth of total retail bank technology spending in the region, expected to reach $US23.4 billion by the year’s end.
Spend by emerging economies, including Afghanistan, Bangladesh, China, North Korea, Papua New Guinea and Vietnam, was expected to grow the fastest at a rate of 8.3 percent to reach $US10.2 billion this year.
The Australian market would grow steadily at about 3.5 percent a year to reach $US2.73 billion by 2016, by which time the regional market would be worth $US29.3 billion, Knapik reported.
He said the Australian market was “growing [healthily] overall”, with online and mobile banking investments experiencing the strongest growth.
Late last year, the Commonwealth Bank launched its Kaching iPhone application, inviting customers to transfer funds, check their balances, and make contactless payments using near-field communications (NFC) technology.
Other banks, including ANZ, NAB and Westpac have also trialled contactless mobile payments internally, with the latter expected to kick off commercial trials as early as this year.
Online banking portals have also been refreshed, with Westpac expected to introduce a new platform that would support multiple devices and could be customised by users this financial year.
Ovum expected Australian retail banks to spend a total of $222 million on online banking technologies this year.
“Returning revenues to pre-recession levels is a priority for a number of institutions, although for many it is unsurprisingly a significant challenge,” Knapik said.
“Banks still need to focus on improving customer trust and increasing sales and servicing effectiveness.
“This will lead to accelerated investment in channel technology, predominantly online banking or other channels such as mobile.”
Ovum also highlighted customer analytics, customer data management systems and risk and compliance products as “hot areas” of investment.