Core Banking can be broadly defined as a back-end system that tends to process banking transactions all over their branches, across the world. It can also be regarded as a banking service duly provided by a group of bank branches, facilitating customers to easily access their bank account and perform basic transactions from any of the member branch offices. It mostly correlates with retail banking as there is always a tendency to treat retail customers as their core banking customers.

‘CORE’ is an acronym for ‘Centralized Online Real-time Exchange’ and thus, under this centralized system, bank branches are now able to access core banking applications from centralized data centers.

Facilities of Core Banking

• It considerably brings down operational costs.

• It always ensures minimal man-power for execution.

• It mostly enables greater accountability of the customers.

• It is a user-friendly and reliable one.

Benefits of Core Banking

• There is a subsequent increase in Customer loyalty as Core Banking Systems enable banks to meet customer’s needs and provide exceptional customer services.

• A huge increase in customer’s efficiency can be witnessed as Core Banking Systems have enabled banks to utilize limited professional manpower with much efficiency.

• Core Banking duly minimizes operational and support expenses as it enables banks to handle a huge volume of customers more efficiently at a given time and it can also reduce time to market for new product offerings, settlement, faster clearings, and others and this operation can be done with much effectiveness.

• Core Banking can reduce IT maintenance costs as it involves business analytics which ultimately helps in accessing valuable information in the collected data that helps banks to rectify obvious issues immediately.

• Core Banking encompasses immediate access to analytics as modern Core Banking Systems like Cloud-based Core Banking Systems, are duly integrated with applications for business analytics and this provides customized as well as real-time data of any dimension which ultimately helps banks to gather data for a significant business process.

Core Banking System

This system primarily includes deposit, loan, and credit processing and it is highly motivated to cater the existing as well as the probable customers with heightened liberty to access their accounts and have safer, faster, and easy transactions at length. Within a few days, Core Banking System succeeded in acquiring an elevated space in the banking industry as it has the potential to enable transactions remotely from any part of the world.

Types of Core Banking Systems

• Retail Banking: mostly involves individual customers.

• Whole Sale Banking: ensures business which can be conducted between banks.

• Securities Trading: primarily deals with buying and selling of stocks, securities, and others.

Core Banking Solution(CBS)

Core Banking Software Solution for banks is primarily built on advanced web technologies. It can also be regarded as networking of bank branches that duly permits customers to manage their accounts and utilize an array of banking facilities from all over the world. To be specific, Core Banking Solution(CBS) has the power to designate the customer as the bank’s customer as a whole instead of any particular branch.

Top 10 Core Banking Solutions

1. Facilitates Customer on Boarding.

2. Enhance transaction management.

3. Smartly manages deposits and withdrawals.

4. Efficiently handles payment processing.

5. Initiate healthy Customer Relationship Management activities.

6. Enable to design new banking products.

7. Duly handle loan disbursal and management.

8. Efficiently conduct accounts management.

9. Enable to establish criteria for minimum balances, interest rates, number of withdrawals allowed, and others.

10. Initiate ways to handle interest, calculations, and management.

Core Banking Software

Digital transformation at present is fast with its generous implementation of technologies like blockchain, artificial intelligence, mobility, and big data and these tend to evolve rapidly by strictly dismantling pre-existing infrastructure business models of banks. Thus, this newly incorporated Core Banking Software shows the potential to drive innovation and growth, by duly filling the stretchable gap that existed between financial institutions and customer’s expectations in a most effective way.

List of Core Banking Softwares

• Finacle from Infosys

• TurnKey Lenders

• MX

• NCR D3 Digital Banking Platform

• Temenos T24 Transact

Finacle Core Banking Solution

Finacle Core Banking Solution can be regarded as the best core banking system in the industry and needless to say that it consistently maintains its leadership quality and reputation for years and helps over 100 countries to deliver simpler, faster, safer, and fully personalized banking. It is regardlessly built on advanced architecture which enables it to offer a comprehensive array of capabilities.

Advantages of Finacle Banking System

• It has flexible product factories.

• It encompasses extensive parameterization, product bundling and reusable business components.

• It helps in accelerating innovation and growth.

• Its real-time processing engine opens API and embedded customer insights.

Cloud-based Core Banking

In recent times, Cloud-based Core Banking Systems have started gaining popularity in this new generation as they deploy the potential to become eligible and trustworthy alternatives to traditional core banking systems.

Benefits of Digital Core Banking in the Cloud

• Cost-Effective

Banks can save themselves to invest heavily on dedicated hardware, software and manpower to run the business.

• Flexibility and Scalability

Cloud-based banking can provide a real-time competitive advantage where the ever-changing market and customers needs can be gauged within a short span of time.

• Enhanced Efficiency

Core Banking System in the cloud requires standardized applications and processes which can ultimately turn it much easier for it to align with technology and business operations.

• Provides faster service to customers

Cloud-based Core Banking turned it quick easier to develop and launch new products in the cloud by using configuration editors which makes the availability of the products and processes at ease.

• Innovation

Cloud-based platforms are compatible with open APIs which can ultimately provide innovative third-party services to the customers.

• Security

High-level of security is ensured in Cloud-based Core Banking and there SaaS providers are working hard by building huge teams to work on security issues.

Four Primary Issues faced by banks while replacing traditional core-banking systems with new-generation cloud-based core banking systems

• In the context of cloud-based banking platform, banks mostly prefer a tried and tested system to replace their traditional core banking with the newly arrived ones as the overall shift involves countering risks and confidentiality.

• Traditional core banking involves a wider range of products and process functionality and even made for huge customization to meet individual needs but the next generation cloud-core banking systems are only designed to support a limited set of products and processes.

• Banks expect newly arrived cloud-based core banking systems to integrate with their existing stack of channels, customer-relationship-management systems, data architecture, risk systems, and others but this integration initiates high risk and huge cost.

• Banks need time to trust storing public data on cloud core banking systems without any fear.

Conclusion

Thus, it can be said that a well-crafted software system can make a huge difference to the financial institutions as well as to the customers as it can largely help to build a healthy customer relationship where customers can step forward to appreciate the user-friendly design and flexibility of the system and this can turn banking industry to savour the streamlined procedures and the centralized structure of Core Banking to the fullest.