The Challenges for Banks Adopting Coreless Technology – Part 2
Why managing AI risk presents new challenges
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The difficult of using AI to improve risk management
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How to bring AI into managing risk
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Pros and cons of using AI to manage risks
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Benefits and opportunities for risk managers applying AI
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In the ever-evolving world of finance, banks are constantly seeking ways to improve their operations and customer experience. One such innovation is coreless banking, a technology that promises to revolutionise the banking industry. However, the path to adopting this technology is fraught with challenges. Let’s delve into some of these hurdles.
Legacy Systems Integration
Banks have been around for centuries, and over this time, they’ve built vast infrastructures on once-dominant programming languages like Fortran or COBOL. These systems, while reliable, are often incompatible with modern technologies. Integrating these legacy systems with coreless banking solutions can be a complex and costly process. EPM from ArcOne mitigates this as the platform is built from the ground up using micro-service architecture specifically designed for Cloud. Integration using API’s minimizes the impact of solution delivery which can be done quickly and reliably.
Absence of Established Standards
Coreless banking is a relatively new concept and not yet a widely accepted industry practice. This lack of standardization can make the transition difficult. Banks need to navigate uncharted waters, often creating their own protocols and standards.
EPM from ArcOne adheres to all regulatory standards and complies with KYC and AML requirements.
Alignment with Business Objectives
Banks need to ensure that the shift to coreless banking aligns with their broader business objectives. This requires a clear understanding of the benefits and potential drawbacks of coreless technology, as well as a strategic plan for its implementation.
The business case for adopting EPM from ArcOne centres on 4 key points:
- Protecting and increasing Revenue
- Introducing greater operational efficiency
- Lowering the total cost of ownership of your Technology stack by decommissioning legacy systems
- Improving the customer experience
Data Management and Security
With the adoption of new technologies, banks face challenges related to security, privacy, data management, and regulatory compliance. EPM from ArcOne ensures the safety of customer data, and helps banks adopt security measures to protect against data breaches.
Multi-Year Commitments
Banking executives often find themselves committed to multi-year projects, which can make it difficult to pivot to new technologies. These long-term commitments can create a sense of inertia, slowing down the adoption of innovative solutions like coreless banking.
While the adoption of coreless technology presents numerous challenges for banks, it also offers significant opportunities for growth and improvement. By carefully navigating these challenges, banks can position themselves at the forefront of the banking industry’s future.
