HYDERABAD, Aug 3: The IT capital expenditure of the surveyed banks increased by 23 per cent in FY13 after a delcine of 1 per cent in previous year.
Initiatives taken by banks have been in multiple ares both to augment business services as well as the control functions and include upgradation of core banking system, data center migration, incident management command center, upgrade ATM switches and virtualization of servers among others and it will have a significant impact on the business of banking in the coming years,
Hyderabad-based Institute for Development and Research in Banking Technology (IDRBT) said in its report released here.
While for larger banks , the IT capital expense to total IT expense ratio has stabilized to approximately 18 per cent, smaller banks are increasing their capital expenditure to acquire IT infrastructure with approximately 54 per cent capital expenditure.
Most banks have also put up a robust mechanism for governance and management of IT assets with board level committee and alignment of functional and technical teams for IT implementation, the report said.
In the future, banks will have to focus on two major aspects — delivering customer satisfaction and driving business optimization, the report said and added banks today have built up significant database about the customer – demographics , transactions and behavioral data.
Banks have made significant progress on the financial inclusion front with a growth of 41 per cent in non-frill accounts increasing from approximately 69 million in FY12 to 98 million in FY13 with outstanding balance increasing from Rs 4,459 crore to Rs 7,317 crore respectively.
While the ratio of active no frill accounts (accounts with at least 4 transactions in last financial year) was only 15 per cent, the number of no-frill accounts provided with overdraft increased by 441 percent from 1.5 lakh in FY12 to 8 lakhs in FY13 with the outstanding balance increasing by 225 per cent from Rs 2,256 crore in FY12 to Rs 7,322 crore in FY13, the report said.
Furthermore the BCs and BC agent linked also shows a significant growth of 97 per cent increasing to 1.47 lakhs in FY13 while Self-help-groups (SHGs) linked shows a marginal growth of 9 per cent increasing to 23 lakh in FY13. The scale of progress augurs well for the financial inclusion agenda. (UNI)
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