Retail banking may lose 55% of business to fintech: report
The retail banking sector could lose up to 55% of its business to fintech firms if it does not up the ante in terms of investment in digital transformation, according to a new study titled ‘Enterprise Digital Transformation: Evaluating Indian Enterprises’, brought out jointly by research firm Frost & Sullivan and software lobby body, Nasscom.
The report, released this month, has compared Indian companies across sectors with their global peers in terms of digital maturity, noting that much more needs to be done and challenges such as non-uniform connectivity and scarcity of skilled personnel need to be tackled.
The report reveals that 87% of the companies with large and discrete manufacturing units use analytics to understand the distribution, demand, and supply factors. It further notes that Indian telecom services providers are far behind global players with respect to automation; and that retailers are likely to increase their technology budgets by 18% next year.
The immediate challenges for digital initiatives in India, the study noted, are non-uniform connectivity, speed, and broadband infrastructure along with a scarcity of suitably-skilled personnel in the market despite an abundance of engineers. While there is awareness on the need for digital roadmaps in Indian enterprises, more has to be done to “bring this awareness into action”, the study added.
However, it simultaneously pointed out that government-backed Digital India initiatives such as Digilocker, eSampark, eLearning, Aadhaar linking, and the direct benefits transfer will catalyze this transformation and improve infrastructure and solution platforms. It further noted that an increasing number of enterprises across the country are moving to the cloud, implementing Internet of Things (IoT) solutions, and trying to understand customers better through analytics and social media platforms. As a result, tremendous opportunities are emerging for IT and IT-enabled services (ITeS) providers.
R. Chandrashekhar, president, Nasscom, said, “With the rapid evolution of technology, digital solutions are becoming an integral component of business operations for enterprises across sectors. This is further fuelled by an increase in digital-savvy customers along with the necessity to stay ahead in the market.”
The report is based on a study of 250 firms, suppliers, and users across vertical segments like healthcare, retail, telecom, manufacturing, and banking, financial services and insurance (BFSI), the study analyzes digital transformation strategies of Indian enterprises and assesses value propositions.