“Centralized Online Real-time Exchange” or core banking refers to largely automated and networked banking systems that allow transactions to happen in real-time across any of the member bank branches. Processes that were once done manually are now largely done through interconnected systems with the use of modern core banking software.
Core banking systems today are making increasing use of artificial intelligence (AI) and machine learning (ML) to improve speed and security while removing the need for fallible and time-intensive human inputs. Better data integration and more types of automation are also typical with every new generation of core banking software.
Today, core banking software developers and vendors are largely competing based on customer-side improvements. The new solutions’ heightened emphasis on instant updates, expanded payment type acceptance, and faster issue resolution has proven to be effective at attracting and retaining new bank customers.
Below are just some key customer-centered features that may be implemented through one of today’s new and efficient core banking software:
When properly set up, banking software can be used to give all of a bank’s business units a unified picture of each customer. Along with better app design, this enables customers to easily apply for more of a bank’s services, straight from their mobile or desktop app. Customers can easily apply for loans, purchase insurance policies, and make investments without having to visit a brick-and-mortar location or wait weeks for approval.
Customers can use modern core banking functionality to instantly make a wide range of payments without needing to use 3rd party payment solutions. All they would need is their bank account. Modern banking software makes it possible to make safe transfers to virtually any other bank account or e-wallet, removing the need to manage multiple accounts.
If a customer does want to manage multiple accounts, such as a shared checking account or foreign currency account in addition to their regular savings account, there is no longer any need to be jumping between different apps. The customer-facing side of the core banking software from reputable vendors will typically allow multiple account management out of the box.
Advanced chatbots are now handling a wide range of customer service issues through bank websites as well as on mobile and desktop apps. The use of these tools frees bank customers from the need to wait hours to talk to a human customer service agent and significantly improves overall customer satisfaction. The issues these tools could address are increasing every year, thanks to the ever-expanding sophistication of AI and ML capabilities.
The vast majority of transactions worldwide take place online, with physical cash now far less important than it was in the 2010s. Much of this has to do with the global explosion of eCommerce as well as delivery services. Of all the possible ways to access banking services, doing it through mobile phones is now the most popular.
People are also now more likely to use their phones for banking over desktop, terminal, or over-the-counter options. QR Codes have become increasingly popular for quick and convenient transactions. Any selected core banking solution should permit a seamless customer experience over mobile as the quality of the mobile experience is often a major factor in customer retention
Core banking software is not just a way to facilitate remote banking. The same software can also be used to better facilitate in-person transactions over a point of sale (POS) systems and ATMs. Through smart devices, a variety of methods such as near-field communications (NFC) and QR codes can be used to facilitate payments at terminals and other real-world locations.
Being able to facilitate these kinds of payments is highly convenient for customers, as they will not have to handle physical cash or come in close contact with other individuals. This can give bank customers a secure option for in-person contactless payments and transactions that do not require cash or cards.
Banks and other financial institutions that serve retail customers should adopt software and systems that address the current banking landscape and facilitate today’s ways of doing business. Though older core banking systems remain powerful, they often lack the AI and ML capabilities of current generations of software. These improvements are critical, as they permit customer-facing processes to be smoother as well as safer from fraud and other criminal activities.
Compared to older software, newer systems also tend to be more reliable. Today’s core banking solutions are designed to take full advantage of developments in cloud hosting and internet infrastructure, making them more robust and less vulnerable to outages. This is especially true for those maintained by specialized software and platform providers. This means far fewer service outages, which, in turn, improves the overall customer experience.
Combined with the other customer-centric features outlined above, it’s clear that good banking software is a must for any financial institution interested in boosting and retaining its market share. If you’re interested in purchasing a new core banking solution to improve the overall customer experience, make sure to choose reputable vendors that can offer continued support throughout the validity of your software licenses.