Financial services information technology (IT) has transformed from order taker to strategic business partner. As part of this transformation, IT organizations are finding they must address key challenges with legacy modernization, data management and digital transformation.
MuleSoft is launching a three-part white paper series discussing these challenges and how financial institutions are overcoming them. At the core of each of these challenges is the need for a new level of connectivity. Financial services organizations must seamlessly integrate applications, data and devices and it is those organizations that are able to embrace these challenges–those “connected financial institutions”–that will win.
The first white paper in the series discusses how firms can refresh and extend existing systems to address shortcomings with legacy technology. Legacy modernization initiatives are being driven by three key challenges: aging back office systems, improving operational effectiveness and the rise of open source software.
Relying on Aging Back Office Systems
The IBM mainframe recently celebrated its 50th birthday and remains the processing workhorse at many large financial services firms. These firms depend on mainframes to run back office systems for such critical functions as deposit accounting, policy administration, loan servicing, and payment processing. These applications are part of the foundational core application stack for running the business and will continue to serve their purpose for many years to come.
The Need to Improve Operational Effectiveness
Industry analysts estimate that IT departments spend 60 to 90 percent of their budgets managing and maintaining legacy systems, leaving them little time to pursue the innovative products and services that customers demand. With declining profits and rising expenses, it’s not surprising that improving operational efficiency remains a top priority for the financial services industry. The preferred approach to legacy modernization must not only prevent accruing additional technical debt, but must reduce that debt to increase organizational agility.
The Rise of Open Source Software
Looking for alternatives to perpetual software licenses with large upfront fees and significant annual maintenance expense, financial institutions are increasingly looking toward open-source solutions. Key drivers of open source software adoption include higher quality, improved efficiency, and lower costs. After participating in open source pilots, many financial services firms are adopting an “open source strategy” and are now looking at open source solutions for a broad set of applications.
To Learn More
Download the whitepaper, “The Connected Financial Institution: Legacy Modernization Industry Drivers” to learn more about how organizations can address these challenges and create competitive advantage by using integration to modernize existing systems.
MuleSoft’s Anypoint Platform is especially well suited for legacy system modernization, allowing financial institutions to get up and running quickly while providing a framework for evolving connectivity needs across SOA, SaaS, and APIs. MuleSoft is trusted by many financial services firms and insurance companies, including 4 out of the top 10 global banks, to help them become a “Connected Financial Institution.”
Don’t forget to register for our webinar, “Becoming a Connected Financial Institution with Legacy Modernization“.