Middle East and North African banking and securities companies will spend nearly $13.2bn on IT products and services in 2014, an increase of 2.7% over 2013 revenue of nearly $12.8bn, reveals a report by Gartner.
This projection comprises spending by banking organizations on internal IT services, such as personnel, IT services, software, data center technologies, devices and telecom services.
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The report further highlights that the telecom services will be the largest segment in overall IT spending in the banking and securities market at $5.7bn during 2014, and will grow at a rate of 0.6% compared to 2013.
The study forecasts that software and IT services are the fastest growing segments with 9.2% and 8.4% increases in 2014, mainly attributed to the expansion strategies of banks across the region and for modernization and replacement projects of the back-office.
Gartner research director Vittorio D’Orazio said: "The outsourcing of IT, as well as business processes, have become more common across some Gulf countries.
"Business process outsourcing (BPO) is expected to have a strong growth at 12.6 percent in 2014, while IT outsourcing is forecast to increase 8.5 percent from year.
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By GlobalData"Software spending is being driven by the replacement trend of back-office systems, especially from the larger banks, while newer banks are being created from the scratch which opens a lot of new opportunities for IT vendors."
