Core banking solutions have been around for several years and have become a “core” of operations for financial institutions in real terms. While the legacy systems dating back to the 1970s have helped form a foundation of traditional banking, the transformation of these systems today has become the need of hour. Updating to modern CBS for controlling costs, risks and other resources for enhancing the bank’s performance is imperative.
Core banking systems have underlined almost every process in banks. Moreover, these systems are not just ways of streamlining the daily operations, but they define new capabilities, innovations and growth for financial institutions.
Why should banks use core banking services?
1. The necessity to replace outdated technology
Core banking is primarily required to support the deposit collection and loan disbursement system. In the recent times, core banking services are expected to deliver a lot more. They act as a central, rigid platform that bridges incompatibilities, addresses compliance and follows a customer-centric approach to increase overall productivity. They must embrace the new-age technologies like the internet and mobile to lower the cost of transactions, offer convenience and connect with the young customers.
2. Redefining the CBS Ecosystem
Over the years, technologies have changed tremendously and so have its understanding among the management/bankers matured. CBS today is redefined as a comprehensive system that considers planning, design, development, management and support. This includes faster implementation, quick turnaround, and greater benefits in the form of profits.
3. Building vendor relationships for a long-term
Upgrading or implementing CBS is not a child’s play. For it to be successful in the long run, it is important that a right vendor is identified to work on the requirements of banks. Unlike the early days when this decision was left to solely select-few business leaders, recently this process involves participation of IT managers and other business leaders, considering the importance of long-term relationships and their gains.
4. Prioritising customer service
An integrated core banking solution helps financial institutes to have a single view of customers that boost customer experience, thereby minimising the need to resubmit details to different departments/representatives every time. It also enables promoting and selling need-specific, customised products to customers for increased satisfaction.
5. Minimise costs involved in human error
The core banking solutions help in automating banking processes, which otherwise would involve human intervention and become prone to inaccuracy. According to a study by The Data Warehousing Institute (TDWI), the costs of human error while tracking customer information alone remains as high as $600 billion a year. Imagining other costs across the operations conducted by humans is so high that it becomes the topmost reason for employing core banking services.
So, consider using Core Banking Services from an esteemed vendor and redefine your bank’s success story.