Learning Objectives:

  • Explain the role of Core Banking Systems (CBS).

  • Understand the challenges of legacy systems.

  • Describe the transition to modern banking platforms.

5.1 Defining Core Banking Systems

Core Banking Systems are the centralised systems that process and record all banking transactions in real-time. They enable transactions from any branch, anywhere, anytime, providing a unified view of customer accounts.

5.2 The Legacy System Challenge

Legacy systems represent a significant challenge for established banks:

  • Barrier to Innovation: Difficult to integrate with modern technologies.

  • Cost of Maintenance: Expensive and cumbersome to maintain.

  • Skills Gap: Lack of expertise to maintain and update legacy systems.

5.3 Modern Banking Platforms

Modern core banking platforms are:

  • Cloud-Native: Built for cloud deployment.

  • API-First: Designed for integration with third-party services.

  • Modular: Composed of interchangeable modules.

  • Real-Time: Capable of real-time processing.

 

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