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Introducing each new monthly issue of IBS Journal.
Part of the anticipation of the IBS Sales League Table used to be around which supplier would come top of the rankings. It tended to be a two-horse race for core banking between Temenos and I-flex Solutions (now Oracle FSS). The latter had a strong culture and management, a focus on developing markets, and a relatively low cost-base, underpinning its functionally rich Flexcube system.
The emergence of new financial services companies with new business models is mirrored by the arrival of new technology providers. While the cracks are becoming only too publicly apparent in the legacy systems of existing banks, a new generation of challengers is on the way, with this similarly carrying a threat for the incumbent system providers.
As the UK's banking sector is yet to settle down in the aftermath of the crisis, calls for more competition and diversification are widespread. Smaller players and new entrants should be able to get a foot in the door easier. The era of top-tier banks dominating the market should come to an end. Big banks should fully segregate their retail and investment activities. None of this rings new. But what about... uniting everyone on a common banking platform?
In a project where many parties are involved it is vital to organise and manage all the participants from the outset, so that if things go wrong and the blame game begins, decisions can be traced and justified and a constructive way out can be found.
What is holding banks back from using everything new technologies have to offer? Legacy systems that struggle to connect with modern solutions, regulatory restrictions, lack of budgets, but also... the lack of talent.
The best laid plans... IBS carried out a survey over the summer to look at the extent to which banks analyse the return on investment (ROI) on their core banking system replacement projects. We wanted to know what they measured before and after the replacements, what were the challenges of doing this, and what were the results of the studies.
At around the halfway stage in the year, is there any sign of a pick-up in the core banking systems sector? Green shoots are difficult to identify. The region that we highlight in this edition, South-East Asia, shows more activity than most others, while Africa still seems to be relatively busy.
The decision by Emirates Investment Bank to select a system without going through an RFP process has received some criticism on IBS's website since the story was published online. Coincidentally, we also have a case study of Bank Technique in Azerbaijan that selected Oracle FSS's Flexcube via that age-old occurrence of a new senior manager arriving and opting to take the system he knew from his previous bank.
The number of new players in the payments sector seems to multiply by the week. They are queuing up to try to dismantle long-standing value-chains. Just about all of the newcomers are focused on the C2C or B2C spaces, whether domestic or cross-border. While for most there will still be a bank account at either end of the chain, the part in the middle is up for grabs.
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Established in 1991, IBS Journal is the definitive independent source of news and analysis relating to financial technology. We talk to banking systems and financial technology users about their strategies and experiences; we drill down into the activities and plans of the suppliers; and we ensure that our readers are kept fully informed on all of the industry events and trends. Visit the IBS Journal section of our website