Accenture looks at pay-as-you-use to drive banks' business

Firm is working with entities specialising in digital payment and provide operation-as-a-service to small finance banks

Accenture says it sees higher demand for pay-as-you-use models from financial services clients, looking at outcomes for their business while deploying information technology in areas such as digital and mobile apps.

"This greater demand could take so many different forms, as our clients in the new world do not want to have a traditional structure of the way they spent on IT," Piyush Singh, head of its financial services operating group in India, told Business Standard.

Termed by Accenture as an operation-as-a-service platform, it is going to impact the company's revenues. Indian banks have already accepted innovations like digital payment platforms and biometric-KYC (Know Your Customer) checks.

"There is definitely a much greater move for moving towards as-a-service platform and generate revenues from there," Singh added.

The company is working with entities that specialise in digital payment and provide operation-as-a-service to small finance banks.

Globally, banks are relooking at investments in building and maintaining of legacy IT infrastructure. Instead, they're looking at digital options, allowing them to engage customers on smartphones. And, at business models that ensure upfront costs are low, while paying a premium on outcomes that generate based on milestones.

For instance, in North America, more banks are looking forward to collaborate with fintech start-ups. There has been a rise in demand for pay-as-you-use service in Australia, owing to a slowdown in capital expenditure for IT infrastructure.

Accenture's capabilities in as-a-service, coupled with understanding of client strategy, helps it define the business outcomes better, said Singh.

Sector analysts call it a "shift to as-a-service economy". "As business across sectors are moving their technology spending from capital expenditure to operating expenses, IT companies are gradually adapting to such models of services," said Pareekh Jain of HfS Research.

This type of model is expected to help businesses predict their bills for use of technology and offer more flexibility in using the service.

"IT services companies, however, will have to focus both on getting more customers in the new segment and bagging additional deals in this space from existing customers to maintain revenue numbers," Jain added.