Financial institutions ramp up IT innovation
By Elliott Holley
Banks are finally investing more in innovation than in legacy systems, according to Capgemini
Banks and other financial institutions are now spending more on new products such as mobile and data analytics than on maintaining their legacy systems. Mobile and cloud technologies are leading the way, according to a new report by technology and outsourcing consultancy Capgemini.
In its 2014 World Quality Report, Capgemini notes that 53% of financial services IT budges now focus on new application development initiatives. Quality assurance and testing are receiving renewed emphasis, following a period in which simply keeping systems running was the biggest priority, according to the report.
Much of this funding is being channelled into mobile applications and cloud services. Nearly half (46%) of financial services executives interviewed by Capgemini in 2013 stated that they didn’t test mobile applications and devices, but in 2014 that figure has reduced to 15% as greater emphasis is placed on application quality, reliability and overall user experience.
Meanwhile, 56% of IT heads in the report said cloud services are among their most significant IT investments, with most companies using cloud to host and test their applications. The research data shows that within financial services, as many as 29% of applications have been migrated to the cloud (an increase from 19% in 2013) and that 31% of testing occurs in cloud-based test environments (an increase from 24% in 2013). Almost all cloud investments within financial services are likely to continue in the private cloud space, given security concerns and the need to report on data security to external auditors and industry regulators.
The report also notes that there is increasing demand for specialist skills at banks and financial services firms. The ‘transformational’ programs many of these financial institutions are working on require specialised testing and skills, which often means employing specialist quality assurance staff with a high level of financial services and business knowledge.
The study was based on interviews with 1,500 CIOs, IT directors and testing executives from 25 countries, with 300 respondents from financial services firms.
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