We can define the banking Core as the business that is developed by a banking institution together with its clients and small businesses. The bank treats its retail clients as Core banking, in fact, they have a separate line of business to carry out their tasks. Large companies are managed through the corporate banking division, therefore, Core banking is basically the operations of deposits and money loans.

As there are different types of banks, their business activities also vary, in any case, the main functions of the bank are to process deposits and withdrawals of money, the technology that drives this action to improve the performance of banking in these areas, is called Core Banking solutions (CBS). In this sense, the implementation of the Core Banking System (CBS) brings its benefits, such as the ability to link various branches and the maintenance of accounting books with more precision. The common thing is that the company offers its clients a wide range of services, so we see that the bank, for example, strives to offer its clients the maintenance of their money in savings accounts, grants loans and serves as an intermediary between their investors.

Advantages of a good Core banking system

The banking Core is like a kind of banking DNA since its system has a combination of technology and operation of the financial entity that covers all areas, for which it is integrated as a “gear” to provide the service that the customer expects. When systems become “obsolete” it is time to make changes, both in software and hardware, to the extent that business requirements also change, since it becomes an operational risk, at this point is that the banking Core is changed.

The financial services market requires changing and renewing systems and adjusting them to the needs of customers, who have been adapting to technological changes, in such a way that having a solid banking technology platform will allow us to support those changes, and will give support for the creation of value in transactions. A similar situation occurs with entities that have an international expansion strategy, in which synergies are based on efficient systems platforms in terms of an integrated operating model, as well as the ease of adaptation and later maintenance. Having a good Core banking system has its advantages, which we will talk about below:

Microservices architecture

An integrated core banking system with functionality is implemented using standalone microservices. This will allow banks to carry out migration programs progressively, which provides business benefits by making use of the autonomous business capabilities offered in the form of a microservice. This architecture also allows banks to make changes in the order of solutions, as business priorities evolve.

Focus on the customer

Core banking is a customer-focused system, which is developed with a single vision towards the end-user, which covers all product lines, using all channels intended for this purpose. This will allow the bank to increase its capacity to understand and attend the needs of its clients. This analysis gives a better understanding of the customer, offers solutions, predicts sales, and provides support to services.

Permanent innovation

This architecture allows the bank to carry out permanent, progressive updates in the system of a microservices level. This means that new functionality can be exposed quickly and continuously.

Deposits and accounts

The system allows its clients to access accounts (simple and corporate) with the ability to make transfers and receive deposits, in addition to providing security measures and offering the corresponding support on its platform.

In short, having a good Core banking system allows a great capacity to react and respond to changes, which is the key to being more competitive in the financial and banking sector.

What do you think about this topic? Do you know any other advantages of the Banking Core?

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