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Core Banking – Definition, Characteristics, and Benefits

Core Banking – Definition, Characteristics, and Benefits

Banks need to investigate the chances and possibilities that intelligent aggregation provides thoroughly. One worry is that this strategy would allow rivals to invade treasured client relationships and significantly reduce service margins. Security, privacy, and the lack of clarity surrounding how to profit from and create value from externalizing data assets are the other apprehensions.

What is a Core Banking System?

A back-end system that conducts daily banking transactions and posts updates to accounts and other financial data is a core banking system. Core banking systems frequently have connections to general ledger systems and reporting tools, as well as the ability to process deposits, loans, and credit.

Characteristics and Benefits of Core Banking Systems

Core banking systems must allow current and potential consumers with more control over their account activity. The advancement of technology has made transactions safer, quicker, and less onerous. Core banking systems are now an essential feature of banking because these transactions may be carried out remotely from anywhere in the world.

Partnering with global banking technology solution providers such as Maveric Systems allows leading FIs significantly reduce their operating expenses and the personnel needed for implementation. Additionally, core banking provides for greater customer accountability. Core banking systems today streamline and encourage banks to be more user-friendly. The advantages of core banking systems are numerous and include keeping up with a rapidly changing market and extending the reach of banks to remote locations.

Core Banking System

What constitutes core banking operations?

The capacity to maintain strict deadlines and plan flawless delivery is essential for core banking. Any worthy core banking solution suite must bring tailored tools for efficient channel management. The crucial solution differentiators include:

  1. Design and develop core banking software
  2. Testing accuracy and automated testing
  3. Enhancing applications and high-touch maintenance support.

What are the business benefits of a world-class core banking system?

To better interface with various internal and external services and systems, new core banking systems leverage cloud and digital technologies and employ open API-based architecture. New core banking systems have advantages like lower costs, quicker time to market, and more straightforward integration with different services that can improve client experiences.

Conclusion

Financial institutions must adopt a partnership-driven and collaborative approach to stay relevant today while developing their capabilities to foresee and respond to tomorrow’s market needs in the face of Fintechs and other nonbanking competitors’ accelerating digital disruption.

About Maveric

Starting in 2000, Maveric Systems is a niche, domain-led Banking Tech specialist partnering with global banks to solve business challenges through emerging technology. 3000+ tech experts use proven frameworks to empower our customers to navigate a rapidly changing environment, enabling sharper definitions of their goals and measures to achieve them.

Across retail, corporate & wealth management, Maveric accelerates digital transformation through native banking domain expertise, a customer-intimacy-led delivery model, and a vibrant leadership supported by a culture of ownership.

With centers of excellence for Data, Digital, Core Banking, and Quality Engineering, Maveric teams work in 15 countries with regional delivery capabilities in Bangalore, Chennai, Dubai, London, Poland, Riyadh, and Singapore.

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What Are The Options For Corporate Banking?

What Are The Options For Corporate Banking?

In many large commercial banks, the corporate banking section is a crucial link between the commercial banking group and the capital markets/investment banking teams. Corporate banking departments offer major firms financial services such as cash management, payment processing, credit products, and hedging techniques. The majority of these businesses are traded publicly.

What does the present look like for Corporate Banking?

Corporate Banking is fast getting a makeover that attracts the best-in-breed practices. Leading FIs today focus on how the corporate, commercial, and SME banks are moving away from the challenges of 2020 to growth in 2030. The overhaul is being felt in areas ranging from widespread self-financing to popular subscription models and ecosystems to impactful sustainability leadership.

Insights that are driving the landscape shifts in the world of Corporate Banking

  1. Tech behemoths and massive platforms are expanding their banking services as more large businesses self-finance their operations and extend loans to suppliers.
  2. Corporate Banks are evolving to become clients’ go-to advisors, actively using data to influence clients’ future business plans.
  3. In the era of ecosystems, corporate banks are putting together integrated networks of dependable suppliers to promote client growth.
  4. More customers are asking for sophisticated corporate treasury, legal, risk management, and other services as banks broaden their offerings beyond banking.

Corporate and Institution Banking

Technology as a significant transformation agent for corporate banking

A prominent NTT Data study into the global future of Corporate banking highlights four key technology impacts. It reinforces the value seasoned banking technology organizations like Maveric systems have been offering for over a decade.

  1. The proportion of corporate clients who prefer using APIs for communication as opposed to those who prefer email or face-to-face interactions is three times more.
  2. 85% of banks are attempting to streamline their online portals. The principal justifications focus on client-centricity and customer experience: 53% and 57%, respectively.
  3. 57% of banks are enhancing their KYC and AML processing with AI. Banks are making investments worldwide to streamline and digitize client-onboarding procedures.
  4. 39% of banks choose to purchase a third-party solution, while 61% decide to build their internal cash forecasting The region most likely to buy an off-the-shelf solution is LATAM.

Conclusion

Banks that provide services to corporations, businesses, and SMEs have made incremental transformation investments over the past five years that have only partially addressed changes in client expectations for better service options and more robust digital experiences. Other initiatives are centered on streamlining compliance and addressing specific operational difficulties. Today, there is a more considerable argument than ever for an industry-wide overhaul. Clients now want more value-adding services and more profound experiences than traditional products that may be irrelevant now. The numerous disruptions foreshadow future events and demonstrate the need for a bold vision from leaders of tomorrow. This will entail establishing a mission, creating offerings that support it, and relentlessly putting the customer’s needs first by utilizing data and analytics to offer simple-to-use digital goods and services.

About Maveric

Starting in 2000, Maveric Systems is a niche, domain-led Banking Tech specialist partnering with global banks to solve business challenges through emerging technology. 3000+ tech experts use proven frameworks to empower our customers to navigate a rapidly changing environment, enabling sharper definitions of their goals and measures to achieve them.

Across retail, corporate & wealth management, Maveric accelerates digital transformation through native banking domain expertise, a customer-intimacy-led delivery model, and a vibrant leadership supported by a culture of ownership.

With centers of excellence for Data, Digital, Core Banking, and Quality Engineering, Maveric teams work in 15 countries with regional delivery capabilities in Bangalore, Chennai, Dubai, London, Poland, Riyadh, and Singapore.

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Is DevOps Beneficial to Banking and Finance?

Is DevOps Beneficial to Banking and Finance?

Compared to other economic sectors, the financial industry has historically been at the cutting edge of innovation and technological development. Customers in today’s highly connected and digitalized society want to be able to access and manage their money wherever they happen to be, whenever they want, with the help of straightforward mobile applications, all while keeping sensitive information like their credit card details safe.

DevOps refers to integrating development and operations teams to improve product quality, speed up time to market, and reduce operational costs. DevOps is a viable path at all three levels of financial institutions, for global financial companies bracing for post-COVID challenges, a regional bank looking to improve performance, or a microfinance app looking to update. Maveric is the most suited to help you access a wide range of technologies and a pool of technologists throughout a wide range of projects.

DevOps is bringing the edge in Banking and Finance

DevOps has positively affected 99% of respondents, as per the Atlassian Survey 2020.

  1. The quickness of service: Businesses worldwide that have adopted DevOps are much more likely to make modifications, enhancements, and upgrades than those that have not. Following the implementation of DevOps best practices, the failure rate decreases. Also, embracing DevOps increases the likelihood that a development team can recover from failure more quickly. By encouraging DevOps approaches like a delivery pipeline, the code can open up a new universe of features and capacities while enforcing good discipline.
  2. Conformity with Security Standards: In financial matter, security is a matter of top conern. Data related to investments, transactions, and other activities handled by financial services providers must be safeguarded at all times. To accomplish this, a top-tier software application that conforms to stringent cloud-based safety guidelines is needed. Development security operations, also known as DevOps as security compliance, is an essential practice that must be implemented before adopting DevOps.
  3. The Cloud can be adopted and integrated more easily: Many banks are migrating their non-core banking applications to the Cloud, despite security and compliance concerns still preventing them from fully realizing the benefits of cloud services. Banks can reap the benefits of DevOps’s agility and scalability while enhancing the client experience across all channels. As a result, financial institutions may now employ data analytics and insights to create user-friendly mobile apps for their customers.
  4. Updating Outdated Computer Technology: While the concept of online banking dates back to the 1980s, it was in 1994 that the first dedicated online bank was launched. Since then, the majority of banks have moved their operations online. It’s safe to assume that by the 2010s, most of their infrastructure had become hopelessly dated and insufficient. On the other hand, a significant financial institution must do more than throw out all of its old technology and start over. DevOps is designed specifically for situations like this. By following these guidelines, an aging system can be modernized in a programmatic fashion.
  5. Researching and appraising markets and assets: In addition to a growing number of input feeds and databases, these functions require many calculations. Many businesses can create asset valuation formulas by combining a wide variety of industry-specific data, insights, processes, and analyses. Financial institutions that seek to differentiate themselves in the marketplace through the generation of novel insights will also need to master the art of rapidly scaling up novel data-driven formulae.

Conclusion

To improve teamwork and accelerate the rollout of new software and products, leading banks are adopting “DevOps”—a set of techniques at the intersection of operations and IT development. Operations and IT development teams have vastly different goals, but DevOps aims to bring them together. Maintaining dependable systems is paramount to the work of the operations team. The focus of development teams, in contrast, is on constant evolution. They are responsible for developing new software or modifying existing programs to serve end users and customers better.

About Maveric Systems

Starting in 2000, Maveric Systems is a niche, domain-led Banking Tech specialist partnering with global banks to solve business challenges through emerging technology. 3000+ tech experts use proven frameworks to empower our customers to navigate a rapidly changing environment, enabling sharper definitions of their goals and measures to achieve them.

Across retail, corporate & wealth management, Maveric accelerates digital transformation through native banking domain expertise, a customer-intimacy-led delivery model, and a vibrant leadership supported by a culture of ownership.

With centers of excellence for Data, Digital, Core Banking, and Quality Engineering, Maveric teams work in 15 countries with regional delivery capabilities in Bangalore, Chennai, Dubai, London, Poland, Riyadh, and Singapore.

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BAAS (Business Banking as a Service) is Empowering Your Customers

BAAS (Business Banking as a Service) is Empowering Your Customers

Commercial banking is confronted with a potentially more complex environment than ever before: customer needs, rapid improvement in digital capabilities, digitization, and new sources of competition are compelling banks to innovate immediately.

For one, customers demand immediate, smooth, and omnichannel banking. Secondly, the pressures for product and service innovations are made more complex by the embedded demand for financial services in corporate processes.

Data, Digital, and Technology impact Business Banking and Empowers Customers

As superior technology systems integrators like Maveric would report, banks are preparing for cloud- and API-enabled ecosystems with the help of AI-enabled, networked technology.

Cloud and API technology adoption

Commercial banks collaborate with modern infrastructure providers to upgrade or overhaul legacy technologies. Digital services, such as lending origination and onboarding, replace manual processes and antiquated systems with a single, end-to-end solution that serves SMEs, corporations, and commercial clients. As part of digital transformation, banks have made substantial investments in automating their origination platforms. Moreover, APIs facilitate new collaborations and partnerships between banks, digital banking enterprises, and Fintechs. Moreover, with lower entry barriers, new cloud-based lending services are being rapidly implemented.

There is an immediate need to accelerate the time to market

Digital disruptors innovate through automated document population, e-verification, and verified external data validation to ease servicing evaluations, financial spreading, and deal structuring. As a result, the time required to make a credit judgment quickly decreases.

Data value creation will differentiate performance

Leading commercial banks are transforming their roles to become both producers and consumers of data, for instance, by selling their payment, trade finance, and lending capabilities to other entities. The vast amounts of data created enable commercial banks to strengthen their client connections by personalizing digital experiences and sending highly customized, timely messages based on in-depth consumer information. Niche solutions can be incorporated in a data environment where rivals can be partners.

Integrating financial crime prevention, cybersecurity, data privacy, and regulatory requirements into the engineering and design lifecycle

By integrating new technologies, collaborating throughout the ecosystem, and focusing on data and client security, banks are altering their capacity to combat financial crime. Cybersecurity, once considered the final frontier is now the de-facto foundation of trust and an integral part of every product and service.

Architecting the modern-day commercial banking ecosystem

Leading commercial banks have created platform-based ecosystems that extend beyond traditional banking and cater to a broad spectrum of customers’ growing needs. The future of commercial banking is platform-based service models and competitive ecosystems enabled by data and cloud technology with API access. This situation allows banking systems of the next generation to service multiple individualized client segments. “Platformization” will increase the availability and velocity of innovation for products and services and dramatically cut the time required to gain mainstream adoption. It can also enhance banks’ data collection and analytical capabilities, giving them a significant advantage over non-financial competitors.

Conclusion

Commercial banking is undergoing fast change through digitization, more competition, and stricter regulation. Small and medium-sized commercial banks are adapting to remain competitive. The way forward for Banks and leading FIs lies in evaluating their maturity, shaping their transformation agenda and strategies, and deploying enterprise-wide enhancements to the goal of value maximization.

About Maveric Systems

Starting in 2000, Maveric Systems is a niche, domain-led Banking Tech specialist partnering with global banks to solve business challenges through emerging technology. 3000+ tech experts use proven frameworks to empower our customers to navigate a rapidly changing environment, enabling sharper definitions of their goals and measures to achieve them.

Across retail, corporate & wealth management, Maveric accelerates digital transformation through native banking domain expertise, a customer-intimacy-led delivery model, and a vibrant leadership supported by a culture of ownership.

With centers of excellence for Data, Digital, Core Banking, and Quality Engineering, Maveric teams work in 15 countries with regional delivery capabilities in Bangalore, Chennai, Dubai, London, Poland, Riyadh, and Singapore.

 

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5 Ways FinTech’s are Transforming Banking

5 Ways FinTech’s are Transforming Banking

Banks have used technology to deliver financial services for decades – Credit cards in the ’50s, internet banking in the ’90s, and contactless payments in the ’00s. However, the stratospheric use of technology has only upped the ante. Some instances highlight this. Like the Neo banks (Brazil’s Nu Bank, Berlin’s N26, and the American Chime) operate their complex operations purely on tech without physical branches.

Innovations that FinTech’s represent are primarily focused on improving customer-facing facets. The three growth levers that drive Fintech growth rates are – superior CX driven by the high trust earned, new-age branding, and marketing approaches, including gamification and cost optimization possible because of deep venture capital and leaner virtual operations.

FinTech’s straddles a complex intersection of financial services and technology sectors that disrupt the traditional value chain.

 

 

5 Ways FinTech’s are Transforming Banking

 

1.  Disintermediation is the most decisive Fintech impact. 

Fintechs have primarily disrupted consumer banking, fund transfer & payments, and consumer & commercial lending by offering new customer-centric solutions, leveraging data and analytics to enhance interactions, build trust, and even powering business outcomes with sophisticated operational abilities. As the industry grapples with changing customer behavior, new technologies, and new distribution and business models, Fintechs’ product focus on millennials and Gen Z is characterized by enhanced accessibility, convenience, and tailored products.

2.  With Blockchain technology, Fintech’s game-changing prowess grows stronger.

As Blockchain tech pushes for a democratized financial landscape, Fintechs eye its unprecedented disruption potential. Be it through the use cases of borderless payments, altering KYC forever, bankless financial management, and revolutionary optimization, Blockchain’s digital ledger systems attract because of its un-hackable nature and by removing third-party intermediaries. Like ERP software allows functions and entities to optimize enterprise processes by sharing data and logic, Blockchain enables entire industries to optimize operations by sharing data between businesses with competing economic objectives. With infrastructure cost reduction as a key differentiator, the blockchain trend will likely throw up the highest Fintech winners in the next few years.

3.  Fintech’s infuse agility like never before

As mentioned earlier, Fintech innovations reimagine customer-facing digital experience blocks. With advanced self-service capabilities, Fintechs have revitalized the customer banking possibilities. Today opening new accounts, applying for loans, buying insurance, understanding financial positions, and making better financial decisions are seamless activities customers use and love because of Fintechs. These functions (also how mobile wallets ‘ talk’ to banks) are possible because of API development (Application Program Interfaces). In the same vein, POS terminals have revolutionized the way consumers spend and receive funds. Any discussion on agility is incomplete without acknowledging the growing influence of conversational banking (or voice bots) and the continual advancements in user authentication and security.

4.  Bank-as-a-service – The change agent of 2020s. 

BaaS is a type of developer platform designed to empower fintech companies. The Bancorp Bank, BBVA Open Platform, and Green Dot have launched their own BaaS platforms.

To access the payments system and store money, Fintechs form banking partnerships. These partnerships are becoming the product themselves. As several banks enable digital disruptors and neo-banks to gain access to inexpensive deposits, they earn valuable fee income. Treasury Prime sells BaaS enablement software to multiple banks while SynapseFi and Cambr build API platforms for neo-banks. Along with SaaS Fintechs that offer cost reductions to banks, the BaaS ecosystem is poised for hyper-growth.

5.  Technology Players turning Fintechs – The Maze Multiplies. 

Fundamentally, Banks sit at the sweet spot of data and technology. One disruptive business model gaining strength is high-technology companies (Amazon, Google, and the like) entering the Fintech space. The two domains, banking and software development, share similar concepts – record-keeping, tracking transactions, and predictive modeling. Digital-first companies turn their eyes to banking – Apple’s credit card, WhatsApp payments, Instagram shopping, Google Pay, and Facebook’s foray into financial services – are all developments that point to a more serious future. Expect the resources and investments to multiply, and the partnerships that aim to scale growth will transform banking in ways we don’t fathom.

In sum, leading Banks are learning from the Fintech story. The banking space is poised for exciting developments by encouraging and incubating internal innovation, creating an agile enterprise, aggressively digitizing the customer experience, adopting an entrepreneurial mindset, and overhauling brand positioning to attract purpose-driven demographics.

 

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