"Indian banking, financial services and insurance industry is going to spend Rs 8,000 crore on technology and associated services over the next three years," Sameer Kochhar, CEO, Skoch Consultancy Services said.
The industry had spent Rs 1,837 crore (Rs 18.37 billion) on technology implementation in 2004 and the spending is likely to grow by 20 per cent annually, Kochhar said.
Large public sector banks like State Bank of India and Punjab National Bank are the leading spenders on core banking solution and ATMs in their bid become global players.
"Core banking initiatives that were hitherto limited to only large branches and metro areas are planned to become bank wide phenomena in quite a few cases by 2008," he said.
PSU banks have witnessed massive technology infusion in the last few years realising that investments can be better leveraged through business process reengineering.
As per estimate, an average public sector bank branch spends only six per cent of time on customer acquisition while 46 per cent is spent on back office work.
"By transforming most of the mundane back office jobs to computers much more time can be spent on customer acquisition and other more productive activities," Kochhar added.