17 December 2017
Erik Bogaerts

Banking Mashup

Erik Bogaerts - Naqoda

28Posts 105,429Views 16Comments

The 4 C's of core banking - part 3

26 September 2011  |  3950 views  |  0

A bit overdue, but here’s the third installment of the 4 C’s of core banking.

Finding the best way to tackle legacy core systems has re-emerged as a key topic of debate among banks, from top tier global players to smaller, domestic institutions. With their vast, fragmented architectures, banks’ legacy systems are typically cumbersome and lack the agility required to adapt to today’s business and market needs. Factors such as evolving customer expectations, new regulations and the need to enter new geographies or launch new products require banks to have flexible systems that can continually adapt to support their evolving business needs.

With legacy systems so far having failed to address these changing requirements, banks should consider four crucial aspects to make their core banking systems more efficient this year: componentisation, going back to the core, compliance and customer centricity.

So let’s continue with the third C: compliance.

In addition to increased competition in the banking space and a need for cost reduction, it is regulatory initiatives such as the Single Euro Payments Area (SEPA), the Payment Services Directive (PSD), the latest Basel III proposals and the UK’s Faster Payments Service (FPS), to name just a few, that are driving banks to refocus on their core banking infrastructures. Banks need flexible solutions in order to comply and respond to the evolving legislative requirements.

As part of some of the regulatory changes, the ISO 20022 messaging standard, for example, has emerged as the recommended format for all payment processing steps under SEPA. It introduces a number of benefits, such as greater STP rates that enable banks to save time and money. What’s more, it offers a more standardised payments service that allows banks to conduct business across national borders, thereby delivering improved customer service. Crucially, ISO 20022 will streamline and standardise payment processes, which means that banks will also have a greater opportunity, as well as more time and money, to focus on innovating payment solutions and services.

In order to take advantage of the benefits new regulatory initiatives offer, the move from old, siloed legacy systems to a universal messaging standard will help both banks and their corporate customers to enhance their transaction processes and help them reduce the global maintenance costs dedicated to payments processing.

If you missed the earlier parts, you can find them here and here. And look out for the final part next week.


TagsRetail banking

Comments: (0)

Comment on this story (membership required)

Latest posts from Erik

Core banking: no more lipstick please

07 March 2017  |  5444 views  |  5 comments | recomends Recommends 0 TagsRetail bankingInnovation

An afternoon of Japanese open innovation and karaoke

08 February 2017  |  4953 views  |  0 comments | recomends Recommends 0 TagsInnovationStart ups

Industrialisation to unlock the efficiency and agility of banking

30 January 2017  |  3900 views  |  0 comments | recomends Recommends 0 TagsRetail bankingInnovation

Legacy systems, it all starts with a pot belly

24 October 2013  |  1561 views  |  0 comments | recomends Recommends 0 TagsRisk & regulationInnovation

Flexbility is killing

05 February 2013  |  3149 views  |  2 comments | recomends Recommends 0 TagsMobile & onlineTransaction banking

Erik's profile

job title Owner
location London
member since 2010
Summary profile See full profile »
Erik Bogaerts is the owner and director of Naqoda, a FinTech company providing software solutions to the financial industry.

Erik's expertise

Member since 2010
25 posts16 comments
What Erik reads
NaqodaCore Banking Platform

Who's commenting on Erik's posts

Ketharaman Swaminathan
Tapan Agarwal
Rodney Farmer