Published on: April 13, 2023
Learn about the future of financial services and how to adapt to digital transformation.
The financial landscape is being transformed by digital-native disruptors and market demands. With the rise of FinTech competitors and stringent regulatory requirements, financial institutions face enormous pressure to innovate quickly in order to remain relevant and compliant.
To deal with all those developments, traditional financial service providers must abandon the short-term ROI-centric approach to technology investment and capture a long-term view. Embracing technological innovations will allow them to remain competitive and compliant.
However, keeping up with the industries' requirements is hard due to the numerous limitations imposed by many companies’ monolithic, and outdated tech stacks.
We are witnessing game-changing technologies that have significantly impacted the financial industry. A component that has gained meaningful traction due to its technology - is core banking.
Traditionally, these systems were built using on-premises technology. This meant that physical servers and software installed and maintained on-site by the bank's IT department.
The development of cloud-native systems and API-functionality integration give core banking the opportunity to ‘step functionalities up’. Now, they can keep up with the pressing demand for digitalization of all systems. With improved scalability, agility and security, operations executed on digital-native systems are quickly proving to be the future for many day-to-day processes. All of that, with the added value of much lower costs.
Today, cloud technology and APIs support the development of cloud-native core banking systems. These technological advances allow financial services to leverage solutions based on the cloud to keep up with the pressing market demands. Digital-native systems quickly prove to be the future for many day-to-day processes—all with the added value of lower costs.
Next-gen cores are the platforms that keep financial service providers' needs and ambitions in mind.
Next-gen core banking platforms are cloud-native financial processing systems with a cutting-edge, flexible, scalable, and composable architecture. They allow their adopters to leverage modern technologies to make banking processes smooth and automated.
In the current market, we see new tech-savvy players (I.e., FinTech’s, neo banks, and non-financial institutions), and some banks addressing ongoing market demands through adopting digitalization.
Financial institutions that initially feared the impact of new-age technology have started seeing its potential, due to the constraints of their core architectures and their slow pace of modernization. Therefore, the logical next step is to adopt a modern cloud-native one, that will enable them to innovate faster and operate more efficiently while decreasing IT service costs.
To learn more about the key benefits of adapting a Next-Gen Core Banking system, read our in-depth guide in the end of this blog.
The field of core banking transformation is constantly evolving, and several trends and technologies are likely to shape the next phase. Regardless of future possibilities, we know now that the most obvious step is adopting technologies that will empower businesses to embrace future ambitions. It is crucial for financial institutions to stay up to date on the latest developments and to maintain an innovative and open mindset to adopt and adapt to them.
Interested in more information on the future of digitalization, how to keep up with it? Download our product brochure and discover how our cloud-native core banking system enables financial services to be future-proof.
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