Domestic Market Insights
Our local market still constitutes the major part of a business of the software and IT service industry (which is almost 63% of the local market). There has been a consistent growth (around 20-30%) in this market over last few years. The trend also shows that the market is maturing in terms of both client requirement and solution response from IT companies.
Banking and other financial organizations (including capital market, Insurance, Leasing, MFIs) still continue to be the major focus for a large portion of IT companies in Bangladesh. In the banking sector, the core banking software market used to be dominated by foreign software companies (though in a number of cases local solution companies are working for implementation and maintenance for those software projects). However, interestingly a good number of local IT solution providers are working with banks for providing a range of ancillary services related to banking (i.e. Internet banking, mobile banking, FDI Automation, Treasury Office Management System etc.). Because of the increased activities in Bangladesh capital market during recent years, a number of companies have developed solutions for merchant banks, brokerage house and issue managers. As regulation in the micro-credit/Micro-Finance Institutions (MFI) are getting more stringent and more pressure is on for operational efficiency, a number of MFI solution development companies are targeting this otherwise untapped market.
Manufacturing sectors including RMG, textile, pharmaceuticals and other consumer goods industries have created sustainable demand for IT solutions like ERP, HR information system, production and financial management solution.
On the other hand, service industries like telecom (second highest after financial sector within service sector), retail & wholesale, healthcare (hospitals, diagnostic centers etc.), education (University, schools and colleges), publishing/media and real state have created sizable market space for IT solution companies.
A good range of software and IT service companies who provide non-specialized services are surviving on business demand generated across different client industries. Examples of such general IT solutions are accounting solution, website development, CRM, sales automation, office management, security solutions etc. The local software industry has been trying to keep pace with the most recent development going on across technology and communication space. A number of companies are developing apps for mobile and other hand-held devices. Some companies are also providing services (platform or content service) in the new business models like pay per use, primarily using the mobile distribution channel.
As it’s seen, our IT industry has matured over time. The industry is no more remaining on the sideline. It has joined the mainstream and not only the industry is contributing significantly to the national income, but also, it has been playing very crucial role in creating high-quality employment for a sizable portion of young graduates of the country. The presence of a high number of young entrepreneurs and startups is one of the distinctive features of this industry. We have seen many tech-savvy young graduates, returning from abroad after finishing education, to start their IT ventures in Bangladesh. Many Venture Capital companies are also investing in tech startups in Bangladesh recent days. Despite many local and global challenges, our young spirited entrepreneurs are doing remarkably well in building sustainable business organizations through their hard work and passion. Certainly, the enthusiasm and resilience of the young entrepreneurs are the main driving force of Bangladesh IT industry now, but the existing local leaders are also the ones we’re looking forward to putting our remarks on a global market.