How to Choose the Right Core Banking Provider: 5 Key Takeaways

In partnership with Ross Republic, we recently published a whitepaper “It’s time to build! Making the right technology choices to enable true business transformation in banking”.

In this whitepaper, we explore how banks face a challenging environment, with multiple factors threatening their competitive advantage in the market.

However, this is not a “banks are doomed” piece; on the contrary, we go on to identify multiple avenues for increasing revenues and improving customer acquisition and retention through investments in the right technologies coupled with operational transformation.

Using this research, executives from both technological and business backgrounds will have the tools they need to make sound technological decisions and accelerate their digital transformation processes.

Let’s take a look at the 5 key findings of our whitepaper.

1. Banks are Facing a Hostile Environment

Now, more than ever, banks are challenged by an evolving financial industry; they face constraints resulting from long-term low interest rates, regulatory complexities, high capital requirements and high operational costs.

Additionally, they must also contend with increasingly demanding customers, new entrants to the market (e.g. big tech) and years of accumulated tech debt.

All of this results in an environment that has become evermore difficult to operate in, and, to retain a competitive advantage, banks will need to adapt. 

2. Three Technologies are Powering Innovation

There are three technological advancements which are fundamental to achieving true digital transformation.

Cloud Computing

Leveraging cloud technologies in the right way enables banks and fintechs to launch new products and services faster, unlock new innovation opportunities and benefit from significant economies of scale.


An architecture based on microservices consists of loosely-coupled modules that cover specific functionalities and communicate with each other through asynchronous messaging. The result is a system that is more resilient, more secure, and easier to maintain in comparison to monolithic IT architectures.


APIs enable connectivity, both internally and externally. What this means for a business is that they can improve internal processes by connecting internal systems and data, whilst also allowing external developers to tap into their data pool to create innovative new solutions, thus giving rise to entirely new ecosystems.

3. The Future is Embedded

With new technologies comes new opportunities for innovation, new distribution channels, new partnership opportunities: entirely new ways of doing business.

In the era of embedded finance, four new business models have emerged that banks can adopt:

  • Digital banks or intelligent digital banks focusing on laser-specific niches.
  • Platforms offering the infrastructure, banking functionalities, balance sheet, regulatory licensing and expertise, or all of it, as integrable services.
  • Aggregator builds and owns the end-client relationships.
  • Orchestrator leverages financial data and capabilities, brand equity and product supply on a group level, while individual ventures remain autonomous.

4. Choosing a Core Provider is Hard!

Working with cutting-edge technology partners, such as Tuum, is key to developing digitally-enabled banking services and business models.

However, choosing the right partner is no simple task. We have listed some of the key considerations banks, neobanks and fintechs need to make when selecting a core provider:

  • Customisation vs configuration. Does the platform allow you to configure the products from within, or will additional coding be required?
  • Functional coverage of platform. Consider the breadth of functions offered by the core provider, and whether third parties will need to be integrated (and to what extent).
  • Migration strategy. big bang, greenfield, gradual?
  • Availability of banking licence. Neobanks and fintechs will need to consider whether or not to pursue their own licence.
  • Establishing overall cost. look out for hidden fees.
  • Cloud vs on-premise. Should you host in the cloud, on-premise, or a combination of both?
  • Aligning technology with business objectives. Carefully consider how new technologies will support business goals.

5. The Right Technological Approach can Yield Dramatic Results

Using real-life examples of Tuum customers, we have shown how combining strategic technology procurement with operational transformation, supported by an experienced core provider, results in rapid improvement of business outcomes and opens up new avenues of revenue to explore. 

With these examples, we demonstrate how financial institutions can successfully position themselves to thrive in the era of digital banking through:

  • Rapid expansion of product offerings
  • Streamlined product configuration processes
  • Improved customer data analytics

Want to get all the insights? Download the whitepaper

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