MADISON, Wis. (7/17/13)--More than $2.06 trillion will be invested across software, hardware and information technology (IT) services by businesses and governments this year, with the U.S. accounting for the most spending and software getting the most funds, said Forrester Research's annual IT spending study. For credit unions, tech spending will continue to focus on mobile and online banking technology to meet rising consumer demand and further engage members.
Credit unions budgeted on average nearly $125,000 toward online and mobile banking this year--a combined expense second only to core processing systems, according to the 2013-2014 CUNA Technology Spending Report, which surveyed credit unions with assets of $50 million or more.
That figure represents about one-fifth of credit unions' average IT budget of $642,797, which doesn't reflect employees' salary or benefits. That ratio holds true among even credit unions with assets of $500 million or more, which on average budgeted $2,055,287 for IT expenses for 2013, said the CUNA report.
About 60% of credit unions indicate that their budgeted IT expenditures for 2013 outpace their 2012 expenditures to some extent, with 17% budgeting double-digit increases.
Among the 24 IT areas examined in CUNA's report, credit unions clearly have earmarked the greatest levels of 2013 funding to supporting their core processing systems, at $185,000 on average.
Among emerging technologies, roughly 60% of credit unions intend to offer mobile/image deposit capture, mobile payments and wallets, and smart cards/EuroMasterCardVisa chip cards by 2015.
Credit unions also expressed strong interest in adding remote deposit capture, person-to-person payments, instant card issue, online account opening, secured email, member/customer relationship management and envelope-free acceptance of deposits.
Credit Union Magazine will publish more information on credit unions' technology spending plans for the rest of this year and 2014 in its October issue.
Globally, businesses and government will spend the largest share--$542 billion--on software, including middle ware, custom-built software, applications and operating systems, said Forrester's report.
IT outsourcing and hardware maintenance will account for $411 billion of their tech spending. That includes computer hardware support services, networks and other outsourcing, infrastructure outsourcing, hosting, application outsourcing, and application management.
Computer equipment spending will total $404 billion, with personal computers having the biggest share--$134.2 billion. But Forrester says that is a shrinking market and the biggest growth in 2013 will be in tablets, specifically the iPad. Tablets will account for $21.1 billion of the equipment budget. Other expenses in this segment include servers, storage, peripherals and "other.
IT consulting and systems integration services will account for $389 billion of the tech spending, with strategy and other consulting services getting $156.4 billion and systems integration project work getting $232.8 billion.
Communications equipment will make up the fifth largest slide of IT spending, with $322 billion spent on telecommunications and enterprise and Server Message Block protocols.