Embracing a Modern Core
While the rise of open banking enables faster implementation of third-party technologies, 89% of institutions prefer to get as much technology from one provider as possible, making selecting the right core provider even more important.
When asked how banks were planning to modernize their core banking solutions in the next 12 months, most bankers plan to invest in core or ancillary products that support ongoing innovation.
Investing in Core or Ancillary Products to Support Ongoing Innovation
Evaluating Technology in Terms of Its Ability to Support Open Banking
Bankers also expressed interest in 24/7 real-time processing and migrating to a public cloud-based core. Only 2% of bankers surveyed expressed no plans to modernize in the next 12 months.
Implementing 24/7 Real-Time Processing
Migrating to a Public Cloud-Based Core System
Industry Insight
At its foundation, core modernization involves moving away from legacy applications towards web-based views and more user-friendly applications. The technology on which most legacy systems are built is reaching a point where it’s unable to support the flexibility and adaptability banks require to stay competitive. As such, 98% of bankers expressed plans to modernize their cores in some way, with more than 60% pointing to investments in innovative core or ancillary products.
This modern approach allows institutions to reap a variety of benefits, including current technology, faster development and increased agility. Relatedly, Celent found that achieving speed and agility surfaced as a top driver of banks’ technology investments as institutions rethink how technology solves business problems.6 Respondents from institutions with asset sizes of $5B - $10B were most likely to select using or expanding use of integrated solutions supported by open APIs, highlighting the benefits open banking and APIs unlock relating to incorporating new technologies.
“In a rapidly changing world, the ability to adapt is not just an advantage; it’s a necessity. Organizations that embrace change and foster a culture of flexibility are better positioned to navigate challenges and seize new opportunities.”
Source: Survey Participant