5 Key Considerations Before Committing to New IT Solutions in Banking

To meet the demands of today’s digital era and stay ahead of the competition, banks must modernize their legacy IT solutions. But what are the crucial factors to consider? Let’s delve into the five must-know pointers for buying IT in the banking sector.

1. Business Transformation vs. IT Upgrade

Historically, legacy system renewals were seen mainly as IT upgrades due to outdated tech or rising costs. But digital transformation isn’t just about fitting old ways into new tools. It’s about innovating existing processes and aligning IT with the broader business strategy. 

Ask yourself this: What defines our bank’s strengths? Which areas need development or heightened focus? Focus should be directed towards improving the elements that best drive the strategic vision forward. 

2. Clear Vision and Metrics

A clear vision of what modernized IT should achieve, and complementing Key Performance Indicators (KPIs) are crucial for any transformation. By aligning these metrics with business objectives, the IT decision-making process becomes more straight-forward.  

Banks need a buy-in from the top management and a shared understanding within the entire organization about the vision, goals, and motivations behind the transformation. IT is meant to enable strategy. If cost savings, for example, would be the key target for their business, ensuring new IT solutions serve those KPIs would be a top priority. 

3. Selecting the Right Technology

Selecting the right technology doesn’t necessarily mean looking at the trendiest option in the market. Banks are often after longevity for their systems, so it’s important to choose technology that will stay relevant for the coming years.  

The best options won’t require frequent updates post-integration and should last for more than ten years. Considering the extensive number of systems banks utilize, newly incorporated solutions need to work seamlessly with already existing ones. 

4. Ensuring Compliance and Cyber Security

Banking faces a labyrinth of regulations, so the chosen solutions must be compliant and offer top-notch data protection. Selecting a partner who is well versed in the rules, requirements, and demands of banking IT ensures well-thought systems. 

Industry knowledge is crucial, especially in banking characterized by extensive regulation and oversight by authorities. And we are talking about one of the cornerstones of modern society, so ensuring cyber security and resilience are foundational. 

5. The Right Partnership

Entering partnerships, especially with companies lacking the banking business expertise, can lead to unexpected obstacles. Additionally, banks looking for longevity may become unpleasantly surprised if their new systems lack flexibility to accommodate future updates – or the IT partner goes out of business entirely.  

The right partner ticks all the boxes most valuable to you, offering industry-specific expertise combined with top-notch IT skills at a cost-efficient rate. They understand the big picture of banking IT consisting of hundreds of systems – and know how to modernize without halting business or hindering innovation under massive IT undertakings.  

Is it time to modernize your IT? Download our guide and find out why modular, progressive transformation is the solution you’re looking for.