Financial institutions spent a combined $615 billion on technology in 2025, according to Gartner’s annual IT spending forecast for the banking and financial services sector. That figure represents 9.4% growth from 2024 and marks the fifth consecutive year of accelerating technology investment. The spending is concentrated in cloud infrastructure, artificial intelligence, cybersecurity, and digital customer platforms, four areas that are fundamentally changing how financial services are designed, delivered, and consumed.
Cloud Migration and Its Consequences
Cloud computing has gone from a strategic consideration to an operational reality for most financial institutions. According to a McKinsey study on cloud adoption in financial services, 82% of large banks had migrated at least some core workloads to public or hybrid cloud environments by 2025, up from 35% in 2020. AWS, Microsoft Azure, and Google Cloud are now infrastructure providers for many of the world’s largest banks.
The shift to cloud has several consequences. It reduces the capital expenditure required to launch new products, since compute and storage can be scaled on demand. It enables faster development cycles, because engineers can provision environments in minutes rather than weeks. And it allows financial institutions to use advanced data analytics and machine learning tools that are available as cloud services.
Fintech is reshaping the $300 trillion global financial services industry, and cloud infrastructure is one of the primary enablers. Without cloud computing, many fintech business models, particularly those that require rapid scaling across geographies, would not be commercially viable.
Artificial Intelligence in Production
AI has moved from pilot programs to production systems at most major financial institutions. JPMorgan’s COiN platform uses natural language processing to review commercial loan agreements, a task that previously required 360,000 hours of lawyer time annually. Mastercard’s AI-powered fraud detection system evaluates every transaction on its network in real time, preventing billions of dollars in fraudulent activity each year.
According to Accenture’s research on AI deployment in banking, 68% of banks with more than $50 billion in assets had at least five AI use cases in production by 2025. The most common applications were fraud detection, credit risk assessment, customer service chatbots, and anti-money laundering compliance.
Fintech innovation is driving 40% faster financial product development, and AI is a key contributor to that acceleration. Machine learning models can analyze customer data, identify product opportunities, and optimize pricing in ways that would take human teams months to accomplish.
Cybersecurity as a Core Investment
Financial institutions are among the most targeted sectors for cyberattacks. According to Statista’s data on cybersecurity spending in financial services, the sector spent $48 billion on cybersecurity in 2025, representing roughly 8% of total IT budgets. That spending covers threat detection, identity management, encryption, endpoint protection, and incident response.
The regulatory environment has pushed cybersecurity spending higher. The EU’s Digital Operational Resilience Act (DORA), which took effect in January 2025, requires financial institutions to meet specific standards for IT risk management, incident reporting, and third-party oversight. Similar regulations are in development in the US, UK, and Singapore.
Fintech platforms are growing faster than traditional banks, but they face the same cybersecurity threats. Smaller fintech firms often lack the resources for enterprise-grade security, which has led to partnerships with specialized cybersecurity providers and increased regulatory attention to fintech security standards.
Digital Customer Platforms
The front end of financial services, meaning the interfaces through which customers interact with their institutions, has been completely redesigned at most large banks. Mobile banking apps have become the primary service channel, surpassing branches, call centers, and websites. A BCG study on digital customer platforms in banking found that the top 20 global banks by mobile app quality saw 25% higher customer retention rates than the industry average.
Digital banking customers are expected to exceed 3.6 billion by 2028, and the quality of digital platforms will be a primary determinant of which institutions capture that growth. Banks are investing in features like real-time notifications, in-app financial advice, biometric authentication, and integrated marketplace offerings.
The $615 billion that financial institutions spent on technology in 2025 is an investment in survival as much as growth. Institutions that fall behind on cloud adoption, AI deployment, cybersecurity, or digital platform quality will face accelerating competitive pressure from both fintech companies and better-equipped traditional rivals.
