Accelerate Bank Transformations

Meta Description: In a synergistic partnership, JMR Infotech and Oracle have collaborated to bring OBDX to financial institutions across the world. It is cloud-native technology of the future generation.

Title: 

Accelerate Bank Transformations with Cloud-Native Cores

Core banking systems have been at the core of financial institutions’ operations for many years. As a result of new digital banking solutions, regulations, and customer expectations, the banking environment is evolving at a quicker rate than it has ever been. Many of these older systems are now struggling to keep up with the times.

In the end, what happened was this: In recent years, banks have discovered that their current digital banking solutions are preventing them from providing the experiences that today’s clients expect. This is primarily due to restrictions in the areas of:

1. Complexity

Due to acquisitions and divestitures, basic banking infrastructures have become intricate and sub-optimal as a consequence, with additional regulatory requirements further adding to the complexity.

2. Flexibility

Core banking systems built initially with reliability in mind are now stuck on aging mainframe architectures and rely on dwindling pools of specialists, resulting in tech stacks that are often prohibitively slow and expensive to change.

3. Capability

Consumer needs are changing, and older cores are being pushed to the boundaries of their capabilities. Many businesses are unable to match current expectations for real-time alerts of transactions, more significant insights into purchasing patterns, and rapid product development, among other things. Consumers are understandably perplexed as to why incumbent banks cannot provide the same level of service as digital rivals.

The bank’s operational officials concur that reform is urgently required in the face of these difficulties. Based on results of a North America Banking Operations Survey, 80 percent of bank executives feel that their organization’s survival might be jeopardized if it does not modernize its technology to be more adaptable and capable of supporting fast change.

In a bid to close the innovation gap, several banks have invested in short-term incremental gains on legacy systems (also known as “hollowing out the core”), which has allowed them to purchase more time as the market continues to develop. Although there have been other contenders in the quest to discover a more permanent solution, one has emerged as the leader in the past several years: cloud-native core banking. As we’ve said above, this method overcomes many of the problems we’ve raised, giving banks a highly scalable API-led core that is agile enough to allow them to compete with new challenger banks in the marketplace.

If cloud-native core banking is the desired objective, the issue then becomes what actions must be done to get there.

Beyond the “big bang.”

When transforming a core banking system, migration from legacy to target systems is one of the most complicated and costly aspects of the project, accounting for around 40% of the total program budget on average.

A major impediment to realizing the advantages of new technology and breaking free from the limits of old systems is the inability to do this arduous chore.

With the Oracle digital banking experience, a leading provider of Next Generation Cloud-Native Core Banking Solutions, JMR Infotech is exploring how adopting a cloud-native core banking solution could benefit banks in their day-to-day operations while also reducing the associated risks the migration journey required to get there. With OBDX as a use case in mind, we’ve observed the following benefits of moving to a cloud-native core architecture:

1. Automated API loads

The data loader service is a single migration API that completely automates the process of loading data into a system. It eliminates previously manual procedures and pauses in the load process, lowering the risk and simplifying the migration event schedule to a large extent.

2. Managed data dependencies

In accordance with a fully flexible dependency structure, the data loader orchestrates the data loading order, enabling banks to deliver all migrated data in a single batch. This strategy decreases the complexity and duration of the migration operation by eliminating the requirement to load data files sequentially.

3. Real-time reconciliations

In real-time, the streaming APIs give notifications for all database changes, including loads and activations. They do so in a scalable manner. This reduces the amount of time it takes to compile financial and operational reconciliations, allowing teams to spend more time analyzing and acting on the findings before going live.

4. Time-travel and simulation testing

It can replicate both previous and future planned product behavior (e.g., interest accrual, EOD, incoming transactions, and so on) within a certain amount of time. A direct outcome of this is that banks can cut the time required to test and confirm complicated multi-day cycles. It also allows them to identify and resolve functional or data problems that would otherwise need extensive testing in production-like settings, resulting in increased confidence before live migration activities.

5. Creative cutover design

This enables data to be placed into production in a dormant state, maintained via delta updates, and activated at the account level in flexible tranches at the time of activation. By isolating data loading from putting that data operationally “active” to customers and colleagues, the effect on customers and migration complexity is reduced to the bare minimum.

Taking the first step

Already, banks are carefully balancing their ambition to be among the first to shift to the cloud with the possibility of experiencing high-profile customer service concerns if they fail in their efforts. Many bankers’ memories of the aftermath of highly publicized botched migrations are still vivid. Which is why using the appropriate tools and strategies is critical to ensuring a seamless transition from one platform to another.

Modern bankers understand that moving to the cloud will result in significant cost savings and improved client experiences. They are also aware that they cannot afford to put off this change any longer than is absolutely necessary. To be prepared for what lies ahead, banks must move quickly to keep up with the speed of change and client expectations. Using the services of an experienced system integration company, you can speed up and reduce the risks associated with cloud-native core banking adoption, allowing institutions to reap the advantages more quickly.

Conclusion:

We at JMR Infotech feel that by giving OBDX to the market, we are actually bringing industry into the twenty-first century. In the end, we’re assisting banks in developing new ideas and new offers that we couldn’t even conceive a few years ago.

%d bloggers like this: