Satoshi Nakamoto Blog
Image default
Uncategorized

Legacy systems holding banks back from meeting demand for instant accounts


UK consumers increasingly expect to be able to set up a bank account instantly, but many banks struggle to do this because of a reliance on paper processes and data siloed on legacy systems.

The study completed by Censuswide for technology company Five degrees found that banks are failing to meet customer demand.

According to the survey of 2,000 UK adults, 43% expect to be able to open an account instantly – however, only 37% of traditional banks and 40% of challenger banks can offer this service.

“Our research shows that the majority of traditional and challenger banks in the UK are currently lagging behind customer demand for an instant account set-up, and so risk missing an opportunity to attract new customers and retain existing ones,” said Peter-Jan van de Venn, managing director and banking IT specialist at Five Degrees. 

He said the continued use of legacy mainframe systems are making it difficult for banks to move to instant account opening. “With the rise of big tech such as Google and Amazon, consumers are now used to fast, personal, safe and always-available portable solutions,” he said. 

“Banks must ensure that they take the same highly personalised and nimble approach as big tech, otherwise they will risk alienating existing and new customers with lengthy on-boarding processes.”

Furthermore, traditional banks risk losing customers due to IT systems going down and leaving customers unable to access services. Due to the complex nature of their legacy IT systems, these banks have more IT outages than challenger banks.

The survey revealed that 38% of customers at traditional banks experience disruption to their service every year, compared with 21% of challenger bank customers.

Traditional banks have accepted that they need to move away from the decades-old systems their customer accounts sit on, but it is a risky process. At big banks, thousands of systems are interlinked multiple times as part of different banking products.

TSB had a major outage when it migrated customers to a new core banking platform form the systems of Lloyds Banking Group, which hosted them from the time the companies were merged.

Paul Pester, CEO at TSB, had to step down after the botched migration of customers to a new banking platform. The meltdown cost TSB £300m, not including the loss of customer confidence.

But banks now recognise that the risk of doing nothing is greater than the risk of changing core systems. For example, Lloyds Banking Group is planning to move 500,000 customer accounts from its legacy IT onto a cloud-based core banking platform from fintech Thought Machine. The system promises Google-like engineering and innovation.



Source link

Related posts

Stars really want to sell you stuff on Black Friday | 1

satoshi

‘Heading south’: Global warming to change climates for millions by 2080

satoshi

Can Bitcoin Donations Secure The Fate Of WikiLeaks Founder?

satoshi

Anomaly Detection Techniques: Defining Normal

satoshi

Fed’s Mester (hawk): Underlying US economy strong

satoshi

Applications and Challenges – Times Square Chronicles

satoshi