Despite costly missteps in tech investments, financial firms are doubling down on software spending in 2025. Why? Because the cost of standing still is greater than the cost of moving forward. AI, IT management, security, and accounting solutions are at the top of the priority list, driven by the need for efficiency, security, and competitive positioning.
A recent Capterra survey of 3,500 professionals—401 of them finance leaders—found that more than 75% of organizations plan to increase software investments. This is happening even though 70% regret a past software purchase. Some of these regrets stem from underperforming vendors, poor implementation, or tools that simply didn’t live up to expectations.
The logic is simple: businesses that don’t upgrade their tech risk falling behind. Inflation is putting pressure on IT budgets, and companies that fail to innovate will pay for it in lost efficiency, security gaps, and shrinking margins. The key isn’t whether to invest, but how to do it right.
Buyer’s remorse is a symptom of poor software choices
Bad software choices are expensive. When financial firms regret a tech investment, it’s usually because they didn’t get what they paid for. Common reasons include misaligned expectations, weak vendor support, and software that was either too basic or too complex for actual business needs.
The fallout from poor software decisions is significant. Nearly 60% of respondents in the Capterra survey reported financial downsides, while 50% said their purchase introduced security vulnerabilities. A system that doesn’t integrate well can slow down operations. A security flaw can cost millions. A tool that lacks the right features forces teams back to inefficient workarounds.
So, what’s the fix? Financial firms need to refine their procurement process. Vet vendors aggressively. Demand clarity on functionality. Focus on fit-for-purpose solutions instead of chasing hype. More spending isn’t the problem—spending on the wrong tools is.
Software procurement is a hidden cost center
Buying software takes time. And in business, time is money. Every new system requires training, implementation, and integration, and those costs often outweigh the licensing fee. The biggest drain? The endless hours executives and IT teams spend evaluating, negotiating, and renewing software contracts.
A study from IT management provider Vertice found that companies spend an average of 385 hours per year on SaaS and cloud contract renewals. That’s nearly 10 full workweeks burned on paperwork, meetings, and negotiations. And that’s just one part of the equation.
The result? IT teams get overloaded. Productivity takes a hit. Procurement becomes a bureaucratic nightmare. Many firms don’t account for these hidden costs, but they should. A smarter procurement process means fewer headaches and a better return on investment.
AI and software spending are surging, and for a good reason
Technology moves fast. If you’re not investing in AI and automation, you’re already behind. Financial firms understand this, which is why they’re leading the charge in software spending.
Gartner predicts that IT spending will increase nearly 10% in 2025, with software investment growing 14% to over $1.2 trillion. AI is a major driver of this surge, particularly in finance, where machine learning and automation are already reshaping operations—from fraud detection to risk analysis to personalized financial services.
John-David Lovelock, a Gartner Distinguished VP Analyst, put it bluntly: AI will be a dominant force in software growth. Financial firms, in particular, are leaning into generative AI, using it to streamline operations and gain an edge in markets where speed and accuracy are everything.
“Just because everyone’s doing it doesn’t mean every investment makes sense. Spending is increasing, but the winners will be those who invest in AI with a clear business case and not just to ride the wave.”
AI is a powerful tool if you know how to use it
AI is a tool. And like any tool, its value depends on how well you use it. Financial firms are excited about AI, but enthusiasm without strategy leads to wasted investment.
Capterra analyst Eduardo Garcia warns that many firms jump into AI without a clear plan. The biggest mistake? Failing to define ROI metrics before implementation. Without clear goals, firms end up with flashy AI features that don’t translate to real-world gains.
The solution is simple: involve the people who will actually use the software. Accounting teams, risk analysts, and security professionals should have a say in tech decisions. If an AI tool doesn’t improve their workflow, it’s just another expensive distraction.
And here’s the real challenge: nearly 40% of financial firms struggle to identify the right AI solutions to adopt. That’s why companies need to focus on the fundamentals. Get clear on the problem AI is solving before you invest. Otherwise, you’re just chasing hype.
Key executive takeaways
- Strategic software investments: Despite past costly tech missteps, financial firms are set to boost spending on AI, security, and accounting software to stay competitive. Leaders should focus on investments that deliver clear ROI and operational benefits.
- Procurement efficiency: Lengthy procurement processes and hidden costs are draining valuable resources. Decision-makers must streamline vendor evaluations and contract management to reduce inefficiencies and secure better deals.
- AI-driven growth: With projections of a 14% rise in software spending and surging interest in AI, technology is a major growth driver. Executives should prioritize targeted AI deployments that align with their operational needs to gain a competitive edge.
- Mitigating buyer’s remorse: Many financial firms regret past software purchases due to unmet expectations and security vulnerabilities. To avoid repeating mistakes, leaders must refine tech selection processes and involve key end users early in decision-making.
