July 15, 2021
TABLE OF CONTENTS
“Core banking modernization” refers to the process of keeping up with the evolution of technology that supports the “engine” of a bank or financial institution (FI). Core banking modernization may go by a slightly different name to different people or organizations; however, the main idea remains.
Core banking modernization is critical to staying competitive, closing the technology deficit, and positioning your tech stack. It can promote competitive advantage, improve processing, boost customer offerings, and encourage agility.
Over the past decade, the introduction of cloud adoption, fintech partnerships, and evolving customer expectations have made digital transformation even more critical for middle market, regional, and community banks. Levvel’s 2021 FI Executive Report highlights how many FIs may be behind in key modernization efforts, like replacing core applications.
The largest FIs (for example, the top-10 largest in the U.S.) have a large, dedicated budget to enhance customer experiences and upgrade technology to solidify their size and competitive positioning. Despite the lack of budget, smaller and mid-sized banks still have the opportunity to take advantage of the proliferation of technologies that currently exist in modernizing their core banking systems.
FIs are at various stages of progress in core modernization efforts and tech-stack upgrades; however, there are plenty of areas of opportunity toward a modern, flexible setup that allows these firms to remain competitive (or even improve their technology).
Getting started and deciding the next steps while facing budget or efficiency demands can seem overwhelming. However, with a proven integration partner, banks can unlock the benefits of modern core technology while avoiding pitfalls that can delay or doom a complex initiative like this. Our next blog in this series will explore the top 10 benefits a core modernization can provide.
Senior Financial Services & Payments Consultant, Levvel
Jason helps banks and financial institutions use the power of technology to improve customer experience, efficiency, and profitability. He has over 15 years of experience in the financial services industry across Retail/Commercial/Corporate and Investment Banking, Capital Markets, and Asset Management. He has led small-scale, quick-win projects and assessments, as well as large-scale digital and operational transformations, enterprise-wide strategy analysis and implementation, and customer experience programs. In his free time, Jason is an avid sports fan and a wannabe foodie. He loves to work out, swim, travel, and experience the great outdoors.