‘Core Technology Holding Us Back’ say 55% of banks – new 10x Banking research reveals

• 55% of banks say the limitations of their existing core solutions is the biggest roadblock to achieving their business goals
• 93% of survey respondents said their success depends on choosing the right core banking solution
• Integration of AI technologies is a key driver of transformation, yet a significant challenge presented by existing core solutions

London: 25 September 2024 – 10x Banking, the cloud-native core banking platform, has today revealed the results of its new research report ‘Core Banking without Compromise’—an in-depth study of over 200 senior IT decision-makers' attitudes towards their current technology estates and the choices they will need to make for effective future transformation.

The independent* research was commissioned by 10x Banking and conducted in June 2024 and found that banking IT decision-makers want to innovate and scale. There is also widespread recognition that banks need to focus on transforming their core banking systems—not only incrementally, but to accelerate the adoption of cloud technologies within the organization. However, their appetite for investing in new core technologies is tempered by the potential risks involved.

The key data findings revealed:

• For 55% of banks, the limitations of their existing core banking solutions are the biggest roadblock to the achievement of their business digital transformation goals, while 53% using legacy core are finding it difficult to scale due to data silos and production bottlenecks.
• Moreover, 93% of respondents agreed their company’s future success relies on choosing the right core banking solution.
• Only 2% of respondents have no plans to deprecate their legacy core technology and replace it with modern technologies. 42% are planning to replace elements of their legacy core technology stack in the next 12 months.
• The risks of migration are preventing 69% of respondents in the banking sector from deploying a next-generation core banking solution.
• Only one in three (32%) respondents have integrated AI into their core, with 39% planning to do so in the next year and 27% within 2 to 5 years. Just 1% have no plans for AI integration with their core banking solution.

A decade ago, as banks sought to overcome the productivity bottlenecks associated with legacy cores, ‘cloud-native neo core’ solutions promised a boom era of innovation in banking and financial services. However, many respondents reported new challenges emerging from neo core solutions that are preventing them from transforming effectively and at their desired pace.

Last month, 10x Banking launched the next generation of banking core technology—the world’s first “meta core”. This next generation of cloud-native core banking platform gives banks the freedom to bring innovative new products, features and personalized services to their customers with unprecedented speed, scale and security, negating many of the challenges raised by the survey respondents.

10x Banking Founder and CEO, Antony Jenkins said of the research findings, “While there are more core solutions available than a decade ago, this research shows that limitations and compromises remain—and they are frustrating both the business-as-usual operations and long-term transformation activities of banks. With the rapid advance of AI and changing customer expectations, the core challenges facing banks could quickly escalate from frustrations to business-critical risks."

For further data and insights on the core challenges facing the banking industry please download the full report here.

*About the survey

Vitreous World, commissioned by 10x Banking, surveyed 206 key decision makers (director level or above) at tier I and tier II banks and financial institutions with more than 500 employees that all use a core banking solution. The survey was conducted in four markets, UK, US, Australia and South Africa. All respondents have responsibility for Information Technology in their role and are the decision makers when it comes to making IT strategy and IT related decisions. The survey was conducted in June 2024.