The Asia Pacific will have the world's highest growth in spending on retail banking technology, which will hit US$28.1 billion for the region by 2015, according to research house Ovum.
Ovum's latest Retail Banking Technology Spending Model shows the Asia Pacific expenditure will grow by 49 per cent in the next five years.
The independent technology analyst believes the overall increase in investment will be driven by the need to grow revenues and improve customers' trust. This will lead to accelerated investment in online and mobile banking, technology in branches (in emerging markets) and channel integration.
"An increase in spending on technology in branches is expected be one of the major driving forces behind this rise in the emerging markets", said Ovum senior analyst Jaroslaw Knapik. The technology spending for branches will increase by 53 per cent in Emerging Asia-Pacific within the next five year timeframe and hit $1.9 billion, as new branches open in the less saturated markets".
The research house says that Japan leads the region in terms of market size with a forecast of US$9 billion, followed by China (US$7.8 billion) and India in third place, holding US$2.7 billion in 2015. China and India hold the position for fastest growth in the Asia Pacific region.
Australia holds fourth place, forecast to grow from US$2.2 billion in 2010 to US$2.7 billion.
Indonesia comes in sixth at US$835 million, Hong Kong comes in eighth at US$747 million, Singapore ninth at US$427 million and Malaysia twelfth at US$276 million.
Ovum's figures show that Asia-Pacific investment in technology to allow customers to access banking services via the Internet will experience growth of 39 per cent from 2010 to 2015, to hit US$1.8 billion.
Knapik said there is a strong focus on online platforms and their extension onto mobile devices and tablets, given their ability to service clients at a lower cost.
"In addition, technologies that allow 'smarter' selling and servicing, such as customer analytics and channel integration, are expected to remain hot spot areas in the near future," he said.
According to Knapik, ever increasing regulatory requirements will also drive investment into technologies that reduce costs, such as data management, business intelligence and analytics.
Spending on various middle-office components, such as risk management, anti-fraud, compliance or performance management, based on these technologies, will experience growth of 51 per cent from 2010 to 2015, hitting US$650 million in Emerging Asia-Pacific and growth of 28 per cent during the same timeframe, hitting US$1.1 billion in newly industrialised and developed economies in the Asia Pacific.
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