SCOTTSDALE, Ariz.–A majority of community-based financial institutions expect technology spending to grow 1% to 10% in 2017 from last year as they look to improve the utilization of technology across digital banking, member/customer relationship management and IT systems, according to a new survey from Cornerstone Advisors.
The survey found nearly 50% of banks and credit unions plan to improve their mobile banking platforms, up from 42% last year, said Cornerstone Advisors, which surveyed 301 executives from firms with less than $500 million to $10 billion in assets. In the IT department, more than half of firms say they plan to improve utilization of network and server virtualization technologies, up from 27% last year, the survey found.
In addition, those surveyed said their technology priorities for 2017 include improving service delivery and efficiency of existing technologies. In most cases, fewer firms said they plan to replace or add new systems or invest in infrastructure upgrades, which could portend a tough year for vendors, Cornerstone Advisors reported.
Nevertheless, Cornerstone Advisors said the increased focus on digital account opening activity reflects that banks and credit unions are beginning to respond to competitive threats from fintech companies.
Broadly, changes in financial institutions’ concerns between 2016 and 2017 “reflect a re-focusing from external concerns — e.g., weak economy and interest rates — to internal concerns like efficiencies, cost and credit quality,” Cornerstone’s report states. “A top efficiency and cost saving priority is streamlining workflow, an area where technology could contribute.”