Alison Ebbage’s piece on IT budgets in the March issue of Banking Technology, looks at the potential impact of the credit crunch on IT spend, offset by a desire to use technology to drive efficiency.

There are indeed several issues that could drive firms to keep investing despite the gloomy times ahead. For instance, recent circumstances have illustrated how important risk measurement tools could be to a financial institution’s future and reputation, and investments into that kind of technology can only be seen as strategic.

There are, however, other, more structural reasons a financial institution might be on a tight budget, beside the economic downturn. Banks operating in some emerging markets, or even small niche and regional players in the developed world, may need to make tough choices when it comes to investing in technology, simply because they have shallow pockets.

Small budget IT strategies will in fact be the focus of an upcoming Banking Technology feature. What are the solutions for cash-strapped institutions? Are outsourcing and ASP delivery the only answers? Do banks in emerging markets actually benefit from a lack of legacy technology, allowing them to build a fresh, homogeneous infrastructure?If you have had to cope with a limited IT budget, or if you have thoughts on the subject, we would love to hear from you via the comment section below.

Filed under: Credit Crunch, Technology