MUMBAI: Technology services providers are already in talks with business houses that have applied for banking licences, hoping to build long-term relationships with these companies which could enter the Indian banking industry next year.
As many as six licences could be issued, making it a persuasive enough opportunity for information technology firms to gear up their sales and marketing departments. "It is an opportunity for a whole lot of players. You have the product companies and the outsourcing companies which would look to position themselves for this.
And any organisation that gets a licence will want to accelerate the roll-out, so incumbents will have an advantage," said Ernst & Young Technology Sector Leader Milan Sheth. It is after more than a decade that the Reserve Bank of India (RBI) is opening up the window for banking licences and a total of 26 applicants, from brokerage houses and Non-Banking Financial Institutions (NBFIs) to industrial houses and micro-finance firms, have thrown their hats in the ring. Besides large conglomerates such as the Tatas, Birlas, Reliance ADAG, others in the race include India Post, L&T, Edelweiss and Muthoot.
Infosys, Tata Consultancy Services and Oracle Financial Services, which provide software platforms, and outsourcing such as IBM, Wipro, HP have been the traditional heavyweights providing technology support to the Indian banking sector. Some of them are already in talks for the new opportunities. The fledgling banks would need a core banking software solution with a payments engine, customer relationship management systems, solutions to handle new banking channels such as Internet, wealth management solutions, provision for regulatory reporting, anti-money laundering and fraud detection, said Venkataramana Gosavi, the regional head for growth markets at Infosys Finacle, the banking product from the Bangalore-based company.
"We are naturally interested in going after this new business," he said. Technology market researcher Gartner estimated that Indian financial services companies will spend some Rs 42,200 crore on IT products and services this year, up more than 13% from 2012. Though talks are in the preliminary stages, the final deal sizes would start at a minimum of Rs 200 crore and are likely get bigger depending on the kinds of platforms and services the banks want, industry observers said.
As many as six licences could be issued, making it a persuasive enough opportunity for information technology firms to gear up their sales and marketing departments. "It is an opportunity for a whole lot of players. You have the product companies and the outsourcing companies which would look to position themselves for this.
And any organisation that gets a licence will want to accelerate the roll-out, so incumbents will have an advantage," said Ernst & Young Technology Sector Leader Milan Sheth. It is after more than a decade that the Reserve Bank of India (RBI) is opening up the window for banking licences and a total of 26 applicants, from brokerage houses and Non-Banking Financial Institutions (NBFIs) to industrial houses and micro-finance firms, have thrown their hats in the ring. Besides large conglomerates such as the Tatas, Birlas, Reliance ADAG, others in the race include India Post, L&T, Edelweiss and Muthoot.
Infosys, Tata Consultancy Services and Oracle Financial Services, which provide software platforms, and outsourcing such as IBM, Wipro, HP have been the traditional heavyweights providing technology support to the Indian banking sector. Some of them are already in talks for the new opportunities. The fledgling banks would need a core banking software solution with a payments engine, customer relationship management systems, solutions to handle new banking channels such as Internet, wealth management solutions, provision for regulatory reporting, anti-money laundering and fraud detection, said Venkataramana Gosavi, the regional head for growth markets at Infosys Finacle, the banking product from the Bangalore-based company.
"We are naturally interested in going after this new business," he said. Technology market researcher Gartner estimated that Indian financial services companies will spend some Rs 42,200 crore on IT products and services this year, up more than 13% from 2012. Though talks are in the preliminary stages, the final deal sizes would start at a minimum of Rs 200 crore and are likely get bigger depending on the kinds of platforms and services the banks want, industry observers said.
"These are end-toend solutions from IT infrastructure, software applications, back-office, and processing.
We are already deeply engaged with most of the potential winners," said Subramanian Venkatramani, vice-president of strategic business relationship at IBM India. But the actual size of the IT contract and the systems will depend on the strategy the bank will follow.
"They will look at each element of the technology they already have, because it's not as if they are scrapping those part of their business.
We are already deeply engaged with most of the potential winners," said Subramanian Venkatramani, vice-president of strategic business relationship at IBM India. But the actual size of the IT contract and the systems will depend on the strategy the bank will follow.
"They will look at each element of the technology they already have, because it's not as if they are scrapping those part of their business.
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