Thought Machine, the cloud-based core banking development provider with its APAC offices in Singapore, aims to invest to help tackle an investment void in the Asian banking industry which needs to be filled if banks that have not migrated to the new core banking systems stay competitive.
Banks that are not equipped to transition to the fourth wave of organic digital core technology are unable to achieve their digitisation targets and are vulnerable to more technologically mature banks acquiring them over the next two to four years.
The key reasons banks are hesitant to upgrade their core banking networks to the fourth generation include recently updated core structures, budget limitations, and an incorrect belief that digitalisation can be achieved by the internet and mobile banking.
Several banks delay, the study highlights that many competitive mid-sized banks are moving fast in implementing core banking structures for the fourth generation. Many banks will undergo true digital transition, improved market efficiency, non-disruptive change and quick incorporation into external and internal processes.
Acceleration of digital transition, opportunities to monetise IT assets, collaborations with challenger banks and Fin-techs, the cost-effectiveness of conversion to new digital product channels and acquisition risk are key factors for banks around the country today to replace their traditional banking.
APAC managing director APAC Nick Wilde from Thought Machine in Singapore said the Asian banking industry is witnessing fast and disruptive disruption.
"Technology is at the root of this disruption, especially cloud systems, allowing new digital banks to be developed from the ground up using cloud technologies, offering reduced costs, improved efficiency and product innovation.
Native cloud banking
The Thought Machine's Vault is a central banking tool for next-generation, cloud citizen. It does not have a single line of legacy or pre-cloud coding, allowing conventional banks to adapt and implement new, cloud-native systems. Its scalable, stable and versatile API-driven technology unlocks the potential of the banking industry to evolve and deliver personalised goods and tailored customer interactions while maintaining health, cost efficiency and virtually zero downtime.
Vault is positioned to serve financial institutions and technology businesses across the continuum-from tier-one multinational banks to smaller national banks, greenfield offerings and Fin-tech companies providing banking capabilities.
Thought Machine is bringing creativity to its clients with Vault. Banks can now introduce core banking on their terms and conveniently and efficiently customise any form of retail banking product, without relying on outside providers for those improvements.
"Thought Machine helps Asian financial institutions, Neo banks and competitors to reinvent core banking services, target new customer markets, and put flexible and scalable hyper-personalised goods into the customer," he said.
In the meantime, IDC Financial Insights Associate Vice President Michael Araneta said financial services organisations need to prioritise core banking technology transformation conversations so that other projects such as digital disruption, customer-centric solutions and personalisation can take centre stage in their future strategy.
Strengthening bank based product revolution
Thought Machine was founded in 2014 by a developer and current CEO Paul Taylor and is headquartered in London. In 2019, it opened its Asia Pacific Regional Office in Singapore to partner with banks around the country, enabling them to step away from the legacy platforms.
Thought Machine plans to extend in the year 2020 to Asia, Japan and North America. The business is planning to recruit on three continents and hit 500 workers by the end of 2020. Customers of Thought Machine include the Lloyds Bank, SEB, Standard Chartered Bank and Atom Fund.
The in-house Vault has recently extended its software available to cover all four leading cloud systems – Google Cloud Infrastructure, Amazon Web Services, Microsoft Azure, and IBM Cloud – offering open core banking. Operating on various network solutions is compatible: SaaS, Private or Public Cloud, Virtual Cloud, and also on-premise. The new SaaS platform provides greater versatility to banks who choose to run single or multiple goods on Vault 's stable micro-services infrastructure, without the program maintenance and upgrades overhead