This article is based on an interview with Diwakar Nigam, Managing Director, Newgen Software, conducted by Anupama Suresh Mehra of Elets News Network (ENN). Originally published on bfsi.eletsonline.com.
Digital Transformation Pressure on the BFSI Sector
The banking, financial services, and insurance (BFSI) sector has historically been an early adopter of technology. However, the current wave of digital transformation poses a qualitatively different kind of challenge. According to Diwakar Nigam, three forces are driving the urgency:
- Shifting customer expectations: Consumers now demand seamless, personalised, and always-on digital experiences across every channel.
- Blurring operational boundaries: Fintech disruptors and non-traditional competitors are eroding the competitive moats that legacy banks once relied on.
- Evolving regulatory compliance: Financial institutions must continuously adapt to changing regulations without disrupting core operations.
Nigam argues that to overcome these hurdles, organisations need an application platform with low-code capabilities that can automate processes and deliver contextual customer engagement. Equally important is moving away from legacy systems and adopting technologies such as artificial intelligence and machine learning (AI/ML), robotic process automation (RPA), blockchain, and advanced analytics to build a resilient, competitive digital business model.
Keeping Pace with Customer Expectations Through R&D
Newgen Software’s approach to meeting evolving customer demands centres on sustained product investment. The company reported allocating 7–8% of annual revenue to research and development, supported by an R&D team of more than 370 professionals with deep domain expertise. The goal is a continuous release cadence of new features across the product stack.
Nigam emphasises that the company’s solutions are built on a low-code application platform, integrating new-age technologies to give enterprises the flexibility required to adapt quickly to changing business and regulatory conditions. This architecture is designed so that customers are not locked into point-in-time feature sets but can evolve their deployments as needs change.
Industry Verticals: Banking Leads, Government Lags
Newgen serves clients across several verticals, including Banking, Insurance, Government and Public Sector Undertakings (PSUs), Healthcare, and Shared Services/BPO. Through its low-code platform, the company also addresses 12 additional segments.
At the time of the interview (H1 FY2020), Nigam noted that the banking vertical contributed more than half of company revenue, while healthcare and insurance together accounted for approximately 18%. The Government/PSU segment, despite slower implementation cycles, was identified as a significant long-term opportunity, given the scale of digital transformation required in public-sector organisations.
How Cloud Computing Is Changing Banking
Cloud adoption in banking is being driven by a combination of economic and operational advantages:
- Scalability: Banks can scale compute and storage resources elastically to meet peak demand — seasonal transaction spikes, product launches, or market volatility — without over-provisioning on-premises infrastructure.
- Lower capital costs: Shifting from capital expenditure (CapEx) to operational expenditure (OpEx) frees budget for innovation rather than infrastructure maintenance.
- Operational simplicity: Managed cloud services reduce the administrative burden on internal IT teams, allowing them to focus on higher-value work.
- Resilience: Cloud providers offer geographically distributed infrastructure and built-in redundancy that can be difficult and expensive to replicate on-premises.
Nigam underlines that a low-code platform deployed via a flexible, scalable, and agile cloud model is particularly well-suited to banking. Cloud deployment creates new avenues for cost-effective software delivery and development cycles that can shrink from months to weeks. Newgen’s products are available on private and public clouds, with support for hybrid deployment models — an important consideration given the data sovereignty and regulatory requirements many banks face.
Nigam cited Newgen’s Cloud/SaaS revenue component as the company’s fastest-growing segment, reporting a five-year compound annual growth rate (CAGR) of 127% at the time of the interview.
Innovation Roadmap: Low-Code, AI, Blockchain, and RPA
Looking ahead from 2019, Nigam outlined several strategic priorities for Newgen’s product and delivery evolution:
- Expanding the product portfolio with new delivery models tailored to specific industry verticals.
- Agile, purpose-made solution accelerators for Banking, Insurance, Government/PSU, Healthcare, and BPO — pre-built solutions designed to compress time-to-value for customers.
- Patent portfolio growth: Newgen had filed 44 patents across India and the United States at the time, with 13 already granted, reflecting the depth of its IP investment.
- Emerging technology integration across the innovation pipeline, including:
- Intelligent content services
- Low-code application development platform enhancements
- Collaborative work management
- Digital sensing
- Blockchain
- Robotic Process Automation (RPA)
Key Takeaways for DevOps and Engineering Teams in BFSI
For engineering and DevOps professionals working within or alongside the banking sector, the themes Nigam raises have direct operational implications:
- Hybrid cloud is the pragmatic baseline. Regulatory requirements mean most banks cannot go fully public-cloud; designing for hybrid from the outset avoids costly re-architecture later.
- Low-code accelerates delivery but requires governance. Low-code platforms reduce the time between business requirement and deployed feature, but teams still need robust CI/CD pipelines, code review processes, and security scanning to maintain quality at speed.
- Legacy modernisation is incremental, not a cutover. Moving from monolithic core banking systems to cloud-native architectures typically requires a strangler-fig approach — wrapping and gradually replacing components rather than big-bang migrations.
- Compliance as code. As regulatory requirements change, embedding compliance checks into automated pipelines reduces the risk of production deployments that inadvertently violate data residency or audit trail requirements.
This article is based on an interview originally published by Elets News Network (ENN) / The Banking & Finance Post, an initiative of Elets Technomedia Pvt Ltd. Statements from Diwakar Nigam reflect conditions and figures current at the time of the interview (2019).