Register a company in the United Kingdom and get a Payoneer account in just 3 days!
A recent International Data Corporation (IDC) report, commissioned by Thought Machine, reveals that while nearly three-quarters of banks worldwide still operate on outdated legacy core banking systems, a staggering 98% plan to upgrade within the next three years to accelerate digital transformation.
The May 2024 reports delve into core banking transformation and data migration strategies, highlighting the challenges of legacy systems and the advantages of fourth-generation cloud-native systems.
Legacy systems struggle to meet the demands of today’s digital customers, with over half of surveyed banks reporting major restrictions in delivering new products and operational efficiencies. Key challenges include the lack of real-time capabilities and the inflexibility to customize products, leading to nearly all banking executive teams expressing commitment to core system changes.
The report emphasizes adopting fourth-generation cloud-native core banking systems due to their flexibility, real-time processing, resilience, and operational efficiency. These systems enable faster product creation, easy customization, and real-time data access for personalized services and improved fraud management. Additionally, they offer enhanced security, reduced hardware failure vulnerability, and the ability to decommission legacy software, freeing up resources for innovation.
Data migration is a crucial aspect of modernization, and the report stresses the importance of enterprise intelligence, which combines data culture, collective learning, information synthesis, and applying insights at scale for competitive advantage. Enterprise intelligence benefits include enhanced customer experience, improved operational efficiency, better risk management, and driving innovation.
The reports conclude by presenting three main migration strategies:
Overall, the reports underscore the urgent need for banks to modernize their core banking systems to keep pace with digital transformation, highlighting the benefits of fourth-generation cloud-native systems and the importance of a well-planned data migration strategy.
The competitive landscape is shifting quickly. At International Fintech Business (IFB), we provide actual IT solutions for online banking and help register banks or finance licenses like EMI/SEMI, API/PI, SPI, MSB, and PSP. Contact us today!