EXCLUSIVE—With mobile #banking services offered at the majority of financial institutions, innovating the #digital space is becoming more important in the #fintech ecosystem, especially for smaller players like regional #banks or credit unions. So, how can these smaller institutions move their digital platforms #beyond the simplest (and expected) mobile banking service? “First off, we need […]
Bank Innovation
EXCLUSIVE – #Fintech #startup #Greenlight #Financial #Technology has just added a new feature that helps #kids understand tricky concepts like #interest, APR and savings accounts. Today the Atlanta-based Greenlight unveiled a feature which lets kids create a savings account through their Greenlight app, an account that is controlled by a guardian. The feature allows the […]
Bank Innovation
While #mobile banking has become normal for the majority of Americans, mobile #payments remain less ubiquitous in the U.S. To change that, merchants and consumers are going to have to find a way out of the “chicken-and-egg” #syndrome that is slowing #adoption, a report released last week by Federal Reserve Bank of Boston found. While […]
Bank Innovation
While #banks focus on competing against each other with similar offerings, are they in danger of being overwhelmed by tech giants with superior analytics and familiar, easily understood interfaces?
Financial Technology
EXCLUSIVE – There’s an argument made in favor of keeping plastic cards and online shopping, but Swedish #payment company #Klarna is not on that side, based on its recent effort to rid customers of the need to use their cards online. Klarna partnered yesterday with payments #technology provider ACI Worldwide to bring this feature to […]
Bank Innovation
Legendary magician Harry Houdini used to perform spectacular escapes #from handcuffs, straitjackets, ropes and chains, and often combinations of them. One of his most famous and difficult escapes was the 1904 London Daily Mirror Handcuff Challenge, where Houdini managed to escape from a pair of handcuffs that had taken a Birmingham blacksmith five years to perfect.
Many bankers see the traditional application service provider (ASP) #model for managing their #core systems—renting the use of core #banking software centrally hosted and managed by a single vendor—as a set of handcuffs they cannot pick. The ASP model proved useful in the early 2000s in helping #banks lower costs. Yet over the years, the constant adding on of various components (think digital user interfaces or new payment types) atop 30-year-old #technology has created an increasingly complex maze of systems that is now hard to maintain, difficult to integrate, designed for “vanilla” service, slow to change and costly to service. Add to that the frustration of vendor-controlled product releases that can take the #future of banks’ IT innovation out of a CIO’s hands.
If banks are to have a chance of competing for customers’ attention and business against the likes of Amazon, Google, Alibaba, fintechs and others, they must devise a clever escape from the constraints of the ASP model. Digital rivals are built bottom up on IT systems that are open, scalable and flexible, enabling innovative services, high-speed responses and efficient operations. Banks need the same traits to be future #ready—to connect with broader digital ecosystems and deliver hyper-relevant services (financial and non-financial, human- and automation-supported) through multiple and rich channels in real time. Those banks unable to rise to the occasion risk becoming digitally irrelevant and targets for acquisition.
Luckily, the typical ASP model is not escape-proof. While Houdini was an illusionist who used tricks to perform his death-defying feats, banks can take a few well-staged steps to truly #free their core banking systems and become future ready.
It begins with designing the bank’s future-state IT architecture. For the future-ready bank, we envision the ASP model evolving to serve as the engine for Systems of Record, Messaging and Services activity. It will be open, modern, secure and agile enough to allow for seamless integration of applications, API management, Cloud hosting, and plug-and-play of best-of-breed technology. Rather than having the lion’s share of its IT served by a single ASP provider, the bank provider pool becomes more diverse, fluid and adaptable. Then, banks will need to rewire their IT delivery organisation to adopt a multi-speed approach, operating and simultaneously supporting multiple business objectives. They will also need to “hollow out the core” and diversify the providers of IT technology for greater flexibility and innovation. Houdini used keys and cutlery; banks can use processes and technology to free themselves from the handcuffs of the ASP model.
Read our recent report, Breaking Free of the ASP Model, for a closer look at how banks can break free of their ASP model—and how a few banks are already doing it.
The post Free core banking from the ASP model to be future ready appeared first on Accenture Banking Blog.
Sure, #cryptocurrency and #bitcoin might seem like the talk of the town, but a recent survey found that #most #people #don’t even #know what a digital currency is. According to a survey conducted by cryptocurrency platform COBINHOOD, only 56% of the 1,035 Americans surveyed knew that cryptocurrency is a digital decentralized currency designed as a […]
Bank Innovation
EXCLUSIVE—#Card company #Dynamics Inc. revealed its #Wallet Card, described by the company as the “world’s #first” #connected payment card, at the CES conference currently taking place in Las Vegas, the company announced today. The card, which was developed in tandem with global #banks and payment providers such as Visa and Mastercard, relies on Internet of […]
Bank Innovation
#Congress #should seriously consider how #fintech is impacting financial services, Rep. Emanuel Cleaver said during an interview yesterday with American Banker. If Congress doesn’t act on the #technology, “we are setting ourselves up for serious problems down the road,” Cleaver told the publication. Cleaver, who is the top Democratic representative on the House Financial Services […]
Bank Innovation
Automated investing #platform #Wealthfront has just closed a $ 75 million round of funding, which will be used to build out its millennial-focused platform, the company announced yesterday. The California-based Wealthfront, which relies on software and algorithms to fuel investments for its clients rather than the traditional human middlemen, will use the capital to keep the […]
Bank Innovation
Reply