Enterprises are likely to scale back on GenAI investments in 2025, preferring to invest in smaller projects, said Biswajeet Mahapatra, Principal Analyst at Forrester Research, during the company’s 2025 Predictions Event Series in India. During the event, the company predicted likely trends in technology for the coming year.

Regarding the investment in GenAI, Mahapatra said, “Most enterprises fixated on AI ROI [Return on Investment] will scale back prematurely in 2025. A lot of investment goes into Gen AI. We did a survey and found that almost 80 per cent of respondents said that you need a 76-100 per cent ROI to get any kind of investment from the management. And ROI on AI is even more challenging because it is an evolving technology.” 

He added that ethical and regulatory issues around data management also discourage huge investment. Instead, Mahapatra estimated investment in low hanging projects such as customer service portals, chatbots, etc. Similarly, he stated that the top 10 per cent of $1 billion and above IT service providers will start delivering 30 per cent of their core services through AI Enabled Platform Services (APS). This will largely include mundane work and shift the entities to a fixed cost service pricing model.

In the finance sector as well, Ashutosh Sharma, Vice President and Research Director at Forrester, said that fewer than 5 per cent of insurers will reap tangible, direct AI gains.

“The technology focus is there in the insurance sector, investing in more emerging technologies. But having the AI making deep improvements in the organisation is a bit challenging partly because they have very poor legacy systems,” said Sharma. However, he predicted that the sector will report more partnerships between traditional and new insurers.

Regarding the banking sector, Sharma said that Al-driven Autonomous Finance “will be the rocket fuel for financial advice” in 2025, with one in four banks leading the launch.

“When we say autonomous finance, it means that the algorithm driven approach for either making decisions, financial decisions to algorithms, or making decisions on customers’ behalf. What it means is that in the next few years, autonomous finance will enable more personalised, international, efficient financial services, which is sort of the holy grail that they’re looking to solve,” said Sharma.

He predicted that banks in Delhi will particularly start embracing some of these AI and empirical services. For the near future, the Forrester analyst expected the service to be a combination of AI and humans, but expected it to eventually become fully autonomous.

Aside from these AI-specific predictions, the company spoke about other technologies like satcom, Software as a Service (SaaS) and quick commerce. Particularly, Forrester predicted satcom to be dead on arrival in India due to competition with terrestrial players and unaffordable prices. For SaaS, it said the model will push 20 per cent of mid-sized services vendors out of business as those entities will be stretched thin trying to provide the specialised SaaS services to customers. Lastly, Forrester expected online retail companies to converge with quick commerce entities in 2025 considering the speedy growth in both the sectors.

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