In a world with a rapidly changing tech landscape, practically every industry has become digitally transformed. And when it comes to banking, there’s no exception. Last year, tech giant Amazon announced a partnership with Bank of America to offer a new lending service, disrupting the banking landscape.
Today, it’s important for banks to play catch-up in the world of digital banking. Disruption is everywhere, which has opened the door for more digitally-savvy bad actors to take advantage of shortcomings within software frames. It’s important for banks to keep their software updated and current as well as their bank cyber insurance, which can help protect a bank’s assets and reputation following something like a data breach.
Here’s why it’s important for banks to upgrade their software.
Core Banking Upgrade Outline
A bank’s back-end system used for processing daily transactions and posting updates, also known as a core banking system, are the nucleus of core transactions for banks. These systems include deposit, loan and credit processing capabilities and need to be upgraded to ensure the best security measures. Original core banking architecture was set up in the 1980s and 1990s, but few have taken steps to make upgrades.
Banks can bring on changes by using a Software as a Service application via cloud communications. This is extremely helpful when it comes to the ever-changing world of payment processing, especially as a younger generation of consumers use applications such as Venmo. Core upgrades should also enable shared data environments and allow banks to use more agile processes, like Software as a Service, as noted above.
When Considering Core Upgrades
Banks should consider upgrading their systems now and get out ahead of the changing digital landscape within banking. Considered vendors should be those who are reputable and established within the software upgrade market while seeking out systems that can assist in meeting business goals. Vendors will be able to provide customizable software upgrade needs for banks including customer-facing processes that deliver a great experience all around.
Banks should also take into consideration vendors who can incorporate expansive business requirements to incumbent core providers, and make sure that vendors have a deep amount of IT support and resources.
Banks can implement a flexible and functionality sound IT solution to a software upgrade. This should be designed and developed as a global package where the provider can maintain and support a global source code.
About Financial Guaranty Insurance Brokers
Since 1983, Financial Guaranty Insurance Brokers has distinguished itself as a provider of Professional Liability, Cyber Liability, and Crime insurance products for entities of all types. To receive timely, personalized service from a knowledgeable and experienced staff, call us today at (626) 793-3330 to speak with one of our professionals.