Karen Massey, Senior Analyst, IDC Financial Insights

Jerry Silva, Research Director, IDC Financial Insights

The 2015 IDC Financial Insights FinTech Rankings were announced on September 15, 2015, on the eve of Finovate NYC. This is 12^th year the analysts of IDC Financial Insights have research the financial services technology market to spot macro trends in the industry, which companies are on the rise, which IT firms are dominating the technology world, and compile the “Who’s Who” among IT vendors to the financial institutions globally. The FinTech Rankings recognize the leading providers supplying the technology that powers the banking, insurance, and capital markets industries.

The IDC Financial Insights FinTech Rankings are based on calendar year revenue from financial institutions. The Top 100 include companies that derive more than one-third of revenue from financial institutions, while the Top 25 Enterprise include companies deriving less than one-third of revenue from financial institutions.

The Top 10 companies on the 2015 FinTech Rankings Top 100 are:

1. Tata Consultancy Services (TCS)
2. FIS
3. Fiserv
4. Cognizant Technology Solutions
5. NCR Corporation
6. Infosys Ltd.
7. Diebold, Inc.
8. SunGard
9. Wincor Nixdorf
10. Nomura Research Institute, Ltd.

This is TCS’s first time appearing at the top of the list, rising from #2 in 2014. In fact, TCS debuted on the Top 25 Enterprise list in 2004 and has experienced tremendous growth in financial services allowing a jump to the Top 100 and eventual rise to #1. FIS had been in the top spot since 2011 when it surpassed Fiserv, the prior reigning #1 company, after their acquisition of Metavante and Capco. But FIS has stirred the pot again with its purchase of #8 SunGard this year, which will likely return FIS to the top again in 2016.

The Top 5 on the FinTech Rankings Top 25 Enterprise are:

1. IBM
2. HP
3. Microsoft
4. Accenture
5. Dell, Inc.

Movement among the Enterprise Top 25 ranks is minimal if not non-existent as there have been few significant financial services-focused acquisitions, and few changes to the composition of industry business mix across the years for these giants of technology.

Combined revenues for the FinTech Top 100 and Top 25 Enterprise companies were $172 billion in revenue in 2014, which is about the size of the Vietnamese economy, the 57^th largest in the world. IDC Financial Insights data shows that global IT spend will reach $500 billion by 2019.  More than 65% of those IT budgets at financial institutions are directed to third-party services and solutions (as opposed to internal investment of IT staff), meaning that financial institutions spend more than $300 billion annually with IT providers, and almost 60% of that external IT investment is with these companies featured on the IDC Financial Insights FinTech Rankings.

Further, IT investment by financial institutions has been growing at 3-5% annually for the past decade. It is notable that revenue for the IT companies on the first FinTech Ranking in 2004 was just over $80 billion, far surpassing the average growth in IT investments to reach $172 billion today. While growth has certainly been achieved, acquisition and consolidation has made these influential fintech giants what they are today.

And consolidation has been good for institutions. Large providers are getting larger because they are acquiring assets to broaden their offerings and provide more holistic solutions to institution clients. After years of lip service regarding trusted partnerships between vendors and their clients, we have witnessed evidence of that promise coming to fruition in the recent past and expect to see more. Consolidation is also happening within the CIO’s domain as institutions want fewer vendor relationships to manage, from a logistical and financial perspective, and also establish relationships that are more strategic than tactical.

Furthermore, IDC Financial Insights believes that institutions will continue to consolidate IT providers in favor of those who can guide and support them through Digital Transformation initiatives and Third Platform technologies, specifically Big Data and Cloud, as internal resources come up to speed on these new transformative technologies. Indeed, institutions are benefiting from increased size, scale, breadth of offering, and expertise from these largest companies on the FinTech Rankings.

So from where will growth come for the FinTech Rankings companies? These folks are certainly focused on Digital Transformation and Third Platform technologies. But specifically growth will come from helping financial institutions sort through the issues of today and tomorrow. We at IDC Financial Insights are starting to draft our 2016 Top 10 Predictions, which will be out in November 2016, and a sneak peek tells us both institutions and IT vendors will be busy. Drivers behind IT investments include themes such as thinking differently about risk management, staying relevant among disruptors to financial services, modernizing while running the institution, among several others. Specific to these drivers, IT vendors will need to have the skills and solutions to assist their institution customers with initiatives including leveraging cloud, the Internet of Things and cognitive systems, managing and profiting from customer engagement, next generation payment systems, and leveraging big data across the gamut of functions in need across the organization (marketing, compliance, risk, etc.).

These companies on the 2015 IDC Financial Insights FinTech Rankings have proven through their financial success that they have tackled these pressing industry needs in the past, so are well positioned to assist institutions through this challenging, yet exciting, time.

The 2015 IDC Financial Insights FinTech Rankings has become a critical tool for financial services institutions to use during strategic planning and to review whenever they consider new investments in 3rd party solutions.  The rankings are also an important way to measure the health and growth of the global financial services technology industry every year.  In addition to the rankings and the products listed above, IDC Financial Insights publishes a comprehensive report about the year’s findings that is available to view or download on the IDC web site.

For more information, please visit  2015 IDC Financial Insights FinTech Rankings