How does the Indian rural market looks like at the moment
We bagged orders from 11 regional rural banks (RRBs) in the last six months for implementing core banking solution and received 42 orders as on September. Rural India is expected to open up in a big way. Banks are expecting to add around 70 million customers over the next 2-3 years. Therefore, there is a tremendous opportunity if we are able to capture the small ticket segment. It is not just the micro finance segment but a complete micro banking in place. Finacles core banking has 2/3rd market in India. So we dont see adding another 100 million customers to this base as a challenge because we are technologically ready. Mobile banking is another wave which is going to drive the rural market.
What is driving growth in the US and European markets
We have witnessed significant focus on new innovations during the last six quarter in the US & Europe. Across the US, the demand deposit account (DDA), mobile banking, payments and integrated platform are picking up. They are looking at moving legacy transformation systems into an integrated platform, which is a big driver in these markets at the moment. With mobile banking, we are shifting focus from transaction-based plain vanilla mobile banking to a relationship-based mobile banking where consumers are doing financial management and can participate in commerce.
Most of your revenue flow is from the emerging markets. Do we see a change in revenue share
About 45% of our revenue flows is from Asia-Pacific (APAC) region because it has a huge market and the overall core transformation work started from here. Europe, Middle East and Africa (EMEA) contribute another 45%. Over the last three years, Europe has grown more than three times. South Asia too is also doing well. We have had six foreign banks going live on Finacle in mainland China. China, where we have a good presence with 150 Finacle professionals, is a market that is opening up. We expect revenue contribution from the US going up to 20% from the current 10%. In absolute terms South Asia and Asia will continue to grow but in relative terms, North America and Europe are expected to pick up. So in the next two years, we might see a shift to 40% from APAC, 40% EMEA and 20% from the US.