Combat the Risks of an Aging Banking System

Jay Cherrie, Executive Advisor
March 22, 2021

Recent headlines have highlighted some of the severe risks of older core banking systems, namely aging user interfaces and a lack of governance.  The accounting foundation of an older core remains solid, but the ability to provide good governance, enforce business rules and present a user-friendly interface to the business person is often lacking.

A recent example of an older core banking system causing an expensive problem, added  complexity to that decision making.  It was a genuine mistake where an operations staff member paid the entire balance of a debt to a syndicate of creditors rather than the intended transaction of only paying the interest due.  The net effect was over $500 million going out the door of the paying bank that could not be recovered.  

 

It’s not just the interface

To borrow from the entertainment world, don’t hate the core, hate the interface.  And it goes beyond solving a simple user interface problem.  Business rules, business process governance and data-driven guidance for transactors are all part of the problem as well.  Even a core swap-out might not solve for all the risks since multiple systems are involved in many of the riskiest transactions.

There’s a better way that leverages your existing investments

But here is the very good news:  there is no need to rip out the entire core banking system (or wire system, or loan management system, etc.) to fix the problem.  It is possible to achieve the benefits of additional controls in the business process and a straightforward user interface that guides and assists the banker or operations specialist.  All you need is an enterprise low-code automation capability.

Using Appian as an orchestration overlay to the core banking system and other associated applications can:

  • Give users a dynamic, interview-style experience with a clean user interface driven by business rules. 
  • Enforce checks and balances appropriate to the transaction being performed, asking for  additional approvals in cases where a ‘sanity check’ raises a red flag.
  • Apply machine learning and artificial intelligence to help a transactor understand if an action fits historical norms or if it is questionable.
  • Deliver the overlay 20 times faster than coding your own solution – and react to operations, risk and regulation driven change with equal speed.
  • All without needing to migrate any data.

You can try it for yourself. Sign up for a free trial of our Low-code Automation Platform and see how easy it is to get the workflow-level controls and modern, intuitive interfaces needed to improve even your most complex processes.