Introducing each new monthly issue of IBS Journal.
This is the time of year when IBS takes stock of what has been going on in terms of selections in the core banking systems market. The vendor submissions are coming in, the cross-checking has started and the IBS Sales League Table is coming together.
What are vendors' promises worth prior to signing the contract, and can a customer hold a vendor to account afterwards? The case of US-based Wildfire Credit Union is set to be a curious illustration. This small entity ($677 million in assets and 37,000 members) is taking mighty Fiserv to court over the alleged unfulfilled claims and promises made by the vendor.
In a major technology modernisation undertaking, where does the accountability lie? There is no guarantee that a leadership team that selects a system is going to be there to implement it and see the project through.
It is not all doom and gloom for core banking software vendors, it would seem. Infosys' new CEO, Vishal Sikka, has recently indicated the vendor will double its investment in the Finacle core banking unit, ending speculation that the Finacle business might be spun off into a separate subsidiary and put up for sale.
A question IBS is often asked is why so many banks focus on the time-honoured activities of patching up their existing software rather than tearing it all out and starting afresh. There are a number of reasons for this, with the regulatory risk concerns dominating all other factors at present.
Heightened competition in any sector is typically seen as desirable, giving greater choice to consumers and encouraging better pricing and service levels, but it is seldom this simple. For one thing, it can be a case of, 'be careful what you wish for'. In financial services, payday loan companies have brought more choice, for instance, but not in a good way. And if the additional choice is just more entities providing the same types of service with the same business models as the incumbents, does this really help?
Is the UK core banking software market finally showing signs of life? Vendors large and small are flocking back to the once dormant space as around 25 entities are waiting for approval from the country's regulator, Financial Conduct Authority (FCA), to launch banking operations.
One man's KYC regime is another man's foreign policy. Indeed, it seems to be the US's main weapon at present: the sanctions against Russian individuals and companies which were expanded by the EU and US in the last week of April have echoes of an earlier controversy about whether Iranian banks should have been expelled by Swift in 2012.
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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