Press Releases

Retail Banks Up Investments in Innovation to Stay Ahead of Start-up Rivals: Infosys Finacle-Efma Study

Independent research highlights the stark realities for established banks grappling with competition and changing customer expectations

Bangalore and Paris – November 04, 2015 – Infosys Finacle, part of EdgeVerve Systems, a product subsidiary of Infosys (NYSE: INFY), and Efma, a global not-for-profit organization promoting innovation in retail finance today launched the seventh annual study of ‘Innovation in retail banking’. According to the research, 84% of retail banks have increased their investments in disruptive technologies and innovative services this year to deal with a surge in new industry competitors. This comes at a time when the perceived threat of market disruption in retail banking is mounting.

According to the report, which surveyed over 100 retail banks around the world, approximately three quarters (72%) regard the threat from technology companies, start-ups, retailers and/or telecom players as high or very high. The report highlighted that start-ups introducing new technologies and business models that are counter to established retail banking practices present both challenges and opportunities for banks.

Key Findings:

  • Over two thirds (69%) of banks believe that start-ups will have a high or very high impact on innovation and can help them to develop more innovative solutions
  • Start-ups are introducing new business models such as Peer-to-Peer (P2P) banking, bypassing conventional inter-bank wire transfer mechanisms to lower costs. About 40% of respondents believe such business models will have a significant impact on the industry
  • Despite the impact of new technologies on the banking industry, 60% of banks are not upbeat about start-up challengers and partners. Concerns over regulation and security are high, with half of the banks citing these as the primary challenges of working with start-ups
  • Over two thirds (68%) of banks believe they are becoming more innovative; 84% are increasing their investments in channels; and 82% are increasing their spends on improving customer experience
  • The most important new technologies (after mobile) for banks are advanced analytics/big data where 57% of banks expect the impact to be high or very high. This is followed by open APIs (53%), and the Internet of Things (47%)
  • Mobility is the most sought after competitive solution; almost two thirds (59%) of banks expect mobile technology to have a high or very high impact on the market

The research also highlighted that multinational retailers, such as Tesco and Walmart, have launched banking products (independently and in partnership with GoBank, respectively) to compete with established financial services providers. It also explored the success of TransferWise (payments) for its P2P model that undercuts banks and legacy competitors.


Michael Reh, Executive Vice President and CEO (Designate), EdgeVerve:
"Digitalization continues to massively shake the business foundations of 'brick and mortar' banking institutions. Banks need to proactively disrupt themselves and explore working with innovative start-ups to accelerate change and develop a leading edge in a competitive market. To achieve this, a dual strategy will be critical. Banks need new capabilities to help their businesses grow in new ways. They also need to renew their existing systems, opening them up to benefits of mobility, analytics, cloud computing, and connected systems."

Patrick Desmarès, Secretary General, Efma:
"This year's global retail banking study demonstrates that banks are eager to innovate, develop formal innovation practices, and increase their involvement with start-ups. This is a step in the right direction, but retail banks must be confident about the value of their start-up investments in order to collaborate with start-ups."

Additional Resources:

About Efma

As a global not-for-profit organisation, Efma brings together more than 3,300 retail financial services companies from over 130 countries. With a membership base consisting of almost a third of all large retail banks worldwide, Efma has proven to be a valuable resource for the global industry, offering members exclusive access to a multitude of resources, databases, studies, articles, news feeds and publications. Efma also provides numerous networking opportunities through working groups, webinars and international meetings. True to its vocation, Efma has recently developed an Innovation portal which aims to identify and award the most innovative projects in the retail financial services arena. For more information: www.efma.com

About Infosys Finacle

Finacle is the industry-leading universal banking solution from EdgeVerve Systems, a wholly owned subsidiary of Infosys. The solution helps financial institutions develop deeper connections with stakeholders, power continuous innovation and accelerate growth in the digital world. Today, Finacle is the choice of banks across 84 countries and serves over 547 million customers – nearly 16.5 percent of the world’s adult banked population.

Finacle solutions address the core banking, e-banking, mobile banking, CRM, payments, treasury, origination, liquidity management, Islamic banking, wealth management, and analytics needs of financial institutions worldwide. Assessment of the top 1000 world banks reveals that banks powered by Finacle enjoy 50 percent higher returns on assets, 30 percent higher returns on capital, and 8.1 percent points lesser costs to income than others.

To know more, visit www.finacle.com

About EdgeVerve Systems

EdgeVerve Systems, a product of Infosys (NYSE: INFY), develops innovative software products and offers them on-premise or as cloud-hosted business platforms. Our products help businesses develop deeper connections with stakeholders, power continuous innovation and accelerate growth in the digital world. We power our clients’ growth in rapidly evolving areas like banking, digital marketing, interactive commerce, distributive trade, credit servicing, customer service and enterprise buying.

Today, EdgeVerve products are used by global corporations across financial services, insurance, retail and CPG, life sciences, manufacturing, and telecom. Infosys Finacle, our universal banking solution, is the choice of financial institutions across 84 countries and serves over 547 million customers – nearly 16.5 percent of the world’s adult banked population.

To know more, visit www.edgeverve.com

Safe Harbor

Certain statements in this press release concerning our future growth prospects are forward-looking statements regarding our future business expectations intended to qualify for the 'safe harbor' under the Private Securities Litigation Reform Act of 1995. These involve a number of risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in earnings, fluctuations in foreign exchange rates, our ability to manage growth, intense competition in IT services including those factors which may affect our cost advantage, wage increases in India, our ability to attract and retain highly skilled professionals, time and cost overruns on fixed-price, fixed-time frame contracts, client concentration, restrictions on immigration, industry segment concentration, our ability to manage our international operations, reduced demand for technology in our key focus areas, disruptions in telecommunication networks or system failures, our ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, the success of the companies in which Infosys has made strategic investments, withdrawal or expiration of governmental fiscal incentives, political instability and regional conflicts, legal restrictions on raising capital or acquiring companies outside India, unauthorized use of our intellectual property and general economic conditions affecting our industry. Additional risks that could affect our future operating results are more fully described in our United States Securities and Exchange Commission filings including our Annual Report on Form 20-F for the fiscal year ended March 31, 2015. These filings are available at www.sec.gov. Infosys may, from time to time, make additional written and oral forward-looking statements, including statements contained in the company's filings with the Securities and Exchange Commission and our reports to shareholders. Any forward-looking statements contained herein are based on assumptions that we believe to be reasonable as of this date. The company does not undertake to update any forward-looking statements that may be made from time to time by or on behalf of the company unless it is required by law.

For further information please contact:


Asia Pacific
Sarah Gideon
Infosys, India
+91 80 4156 3373

Paul de Lara
Infosys, UK
+44 2075162748

Cristin Balog
Infosys, USA
+1 (650) 320 4126


Boris Plantier
Business Intelligence Officer
+33 1 47 42 67 69

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