Are you ready to modernize your core platform?
The Jack Henry™ 2024 Strategy Benchmark highlights three reasons why modernizing your core platform and transforming your banking operations strategy can help you compete more effectively in 2024 and 2025.
The Cost of Standing Still is Rising
Many financial institutions that have yet to embark on the journey to core modernization will soon find themselves at a crossroads.
While adopting a new core system is no trivial task, the rapid advancement of cloud-native technologies opens new, incremental migration paths that not only make the transition easier but also extend and expand the capabilities of legacy systems in the process.
Financial institutions delaying action will see peers and competitors take the plunge – reaping the full benefits and efficiencies of AI, open banking, and other data-driven trends – all while their legacy maintenance costs slowly rise.
Study Results: Public, Cloud-Native Core Technology
Banks and credit unions are embracing the public cloud in 2024 and 2025.
In fact, 43% (up from 33% in 2023) of financial institutions plan to include a public, cloud-native core in their strategic plans over the next two years.
Less Risky Core Conversions
Luckily, modern architecture and infrastructure make the pain and risk of wholesale conversions unnecessary.
Cloud-native cores built upon the concept of composability make their modules available via a microservices architecture, allowing you to gradually modernize your technology stack over time. This new approach mitigates the risks associated with a rip-and-replace conversion and enables the deployment of the most important business applications first.
Cloud-native development tools built into these cores also allow for continuous development – reducing the cost and time associated with producing and deploying iterative innovations while widening the gap between modern and legacy core platforms.
In the competition for consumer and commercial accountholders, the technological and cost advantages of these cloud-native core platforms will accumulate and provide the adopting banks and credit unions structural advantages over their laggard peers.
Study Insights:
As banks and credit unions learn more about cloud technologies, they value the unique cost-efficiencies, AI tools, zero-trust architecture, and world-class security algorithms public cloud providers offer. Financial institutions are also warming up to the incremental, de-risked migration paths cloud-native components and architectures make possible.
Flexibility and Scalability Benefits to Your Core Platform Strategy
At the very least, you need to define your core strategy going forward.
By understanding which business applications are of the highest importance, you can take advantage of the flexibility microservice architecture provide and build a roadmap that brings you closer to your desired end state – module by module.
Public clouds are essential for modernization efforts, as they provide the needed balance of real-time scalability, operational resiliency, and cost-effectiveness to manage the surge in transaction processing required for open banking and other digital banking advancements. Public, cloud-native platforms will also be critical in handling the demands associated with real-time data analytics and data management en masse.
Deploying and enhancing your cloud infrastructure effectively requires skills and expertise vastly different from those needed for legacy systems. As you strive to develop a modern technology stack, acquiring talent proficient in managing cloud-native solutions and data cannot be overlooked.
Unlock your potential
Download the 2024 Strategy Benchmark to help you compete more effectively and differentiate strategically in 2024 and 2025.
Ready to modernize your banking operations strategy? Connect with a Jack Henry expert today!
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