Danske Bank chooses Infosys to accelerate digital transformation

Danske Bank taps into Infosys to accelerate digital transformation and offloads its IT centre in India.

Danske Bank has entered into a strategic partnership with New York-listed digital services and consulting company Infosys to accelerate its digital transformation.

The bank will also sell its IT centre with over 1,400 employees in India to Infosys as part of the collaboration. 

The entire contract is reportedly worth $454m.

According to Salil Parekh, CEO and managing director at Infosys, the firm will collaborate with Danske Bank to strengthen its core business with enhanced digital, cloud and data capabilities. The move will enable Danske Bank to tap into AI and generative AI technologies to serve customers.

Infosys will support Danske Bank’s transformation with Infosys Topaz, an AI-first set of services, solutions and platforms using generative AI technologies.

Danske ramps up tech investment in 2026 strategy

The partnership comes on the heels of Danske’s announcement of the Forward 28 strategy and financial targets for 2026. The strategy was unveiled on 7 June at an investor update.

As per the strategy, Danske is increasing its technology investment, focusing on public cloud, data and analytics, security, and reducing legacy tools.

It intends to increase the funding envelope for digital and tech investments towards c.$146.6m (DKK1bn) annually to c.$586.5m (DKK4bn) by 2026.

The bank has also targeted to migrate 30% of applications to the public cloud by 2026. During that period, it also aims to increase productivity by 20% whilst decreasing technology run costs by 15% from 2022.

Technology modernisation continues with cloud and AI

Danske Bank’s digital transformation efforts continue the trend of modernising technology in the financial services sector.

For instance, Santander had allocated over €20bn between 2019 and 2022 for a similar objective. It has since continued its digitalisation efforts across its businesses. 

A survey of 300 financial institutions by consultant Cornerstone Advisors revealed that 76% of banks have already launched a digital transformation strategy or initiative, while 18% expect to launch one in 2023.

According to a Gartner survey of 2,387 CIOs and technology executives across 81 countries, 22% of respondents considered digital transformation toe be their top priority, only behind growth.

While cloud migration was the beginning of digital transformation, newer technologies like artificial intelligence have gained prominence with maturity as part of the projects.

A different 2023 Gartner survey of 2,500 executive leaders revealed that 70% of respondents were currently exploring the potential of generative AI, with 19% already in pilot or production mode.

Last week, BNP Paribas, with the support of conversational AI company Amelia, launched its own gen AI-powered virtual assistant NextGen Online Assistant (NOA) on its client service portal NeoLink.

Cloud technologies also continue to be the target for investment for financial firms as they continue the migration of select databases.

For instance, in October 2022, HSBC signed a multi-year partnership with Oracle to upgrade and migrate its database systems to Oracle Exadata Cloud at Customer.

In February 2023, Intesa Sanpaolo also teamed up with IBM to improve digitisation by leveraging the latter’s resources, including both hybrid cloud and AI.

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