New Delhi: IT spending in Indian banking and securities firms is expected to grow by 11.7% to reach $9.1 billion this year, driven by investments in digital payments infrastructure, Gartner said on Monday.

The transition of the Indian banking sector to a cashless society is creating many opportunities of technology investments into digital payments infrastructure, the research firm said in a report.

“Indian banks are getting back on track after slower IT spending in the last two quarters, which was prompted by demonetisation," Gartner Principal Research Analyst Moutusi Sau said.

More investments will flow into newer concepts like artificial intelligence (AI) and blockchain as banks focus on digital transformation, she added. Several top banks in India are investing heavily into contactless payment, which uses near field communication (NFC) mechanisms, and this too is propelling many investments into devices, the report said.

Devices spending in the Indian banking sector is forecast to grow the fastest at 20% in 2017, followed by IT services at 15.8%. Gartner said firms in the banking and securities industry are investing more in devices to upgrade their existing infrastructure.