What’s core banking to begin with? Why is there so much buzz around it all the time? Why are IT services companies creating products around core banking?
Core Banking Solutions (CBS) is the technology backbone that connects the branches of a bank. Due to this, the customer’s physical banking needs are not restricted to their home branch. They can walk into any branch of the bank anywhere and get their banking needs addressed.
So, what’s changing in core banking?
Let’s understand the basic elements of core banking first. It comprises Internet Banking, Mobile Banking, ATM, point-of-sale terminals, and fund transfers through NEFT, RTGS, etc.
With such proliferation of channels and additional modes of payments such as wallets, UPI, etc., the core banking system needs to be up, running and updated all the time.
When a bank implements a CBS successfully, the customers of the bank are no more customers of the home branch alone. They care the customers of the bank wherever the bank operates. They can walk into any branch and get going with their universal banking needs.
As all branches of the bank are connected to a centralized server through core banking systems and hosted in a secured data center, it helps to speed up a transaction, maintain a single source of truth and records all the time and ensures timely reconciliation at the end of the day.
The core banking system will also seamlessly interface with banking applications that perform basic operations such as transactions management, payments, withdrawals, interest calculations, calculation of loans outstanding and respective EMIs etc. The banking applications also reside on a centralized server and can be accessed through the internet from any location.
With a robust core banking system, banks would be able to manage the huge influx of transactions, maintain tick-by-tick data and ensure fool proof reconciliation.
How does it help to have a Core Banking System?
Today, more than ever, core banking systems have assumed great importance. The CBS can efficiently manage and record operational transactions and reduce time, effort and manpower spent to ensure operational seamlessness. It also enables banks to pass on business value to customers by offerings products and services at customer-friendly rates.
With changing market conditions, regulatory norms, compliance requirements and customer demands, a robust core banking system is imperative.
It ensures quicker services, quicker updates and more time for the bank to focus on product development, customer service and overall operations management.
For the customer, it saves time required for run-of-the-mill banking activities and brings most of the banking tasks to their fingertips.
Is your core banking systems well supported and running seamlessly?
At Clover Infotech, we bring in strong expertise in supporting Flexcube for some of India’s largest banks. Read more about us at Clover Infotech’s Oracle Flexcube core banking solutions