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 India's Tech Mahindra is stepping up focus on its banking, financial services and insurance (BFSI) business in a bid to bridge the gap with larger peers which have historically made more revenue from the lucrative segment, its CEO said in an interview.

Mohit Joshi, who took the helm of India's No.5 software services exporter in December 2023 after more than two decades at Infosys, wants to increase the share of BFSI in Tech Mahindra's revenue mix by up to 25% by March 2027, from about 16% currently.

Some of Tech Mahindra's peers in the $254 billion Indian IT sector already make as much as a third of their revenue from this sector.

"We still have a lot of room to catch up," said Joshi, who started out as a banker with ABN Amro and ANZ before joining Infosys. "I do expect that the relative share of BFSI revenue within TechM will increase, but...organically."

Unlike its peers, Tech Mahindra has relied heavily on telecom clients to boost revenue. That will change as Joshi tries to take advantage of his own expertise and experience dealing with financial services firms to turn the company around.

"BFSI is the single largest spender from a tech services perspective. It's very important for us to play aggressively in this space. Large banks typically spend over $10 billion a year in terms of technology," Joshi said.

Tech Mahindra, which has lagged its peers in both revenue and profit, will focus on core banking, payments, asset and wealth management and custodian services, as well as insurance, he said. Joshi has already shored up its BFSI leadership.

GENERATIVE AI

Generative artificial intelligence is a friend and not a foe for the sector, according to Joshi.

"GenAI is the best spokesperson for why we need more money to be spent on technology," he said, adding it is not the end of the road for software developers.

"I do feel that the overall demand for developers is not going to reduce, because there is a lot more work to be done candidly than there are people just now."

Joshi played down concerns about any potential hit to customer service roles at Tech Mahindra.

"I'm very skeptical about whether we'll see a wholesale replacement of contact centers with GenAI because when it comes to critical issues, people prefer to speak with human beings."