Core Banking Solutions for Small Credit Unions
Core banking is the nerve center of a credit union. Credit unions, with the help of platform vendors, have been able to leverage Internet technology to handle transactions.
Most of the paper-based transactions of the past have been replaced by digital alternatives. Automation has introduced a new level of efficiency and productivity. What had existed as a disparate group of branches is now a networked entity operating as a whole.
In a new report, Core Banking Solutions for Small Credit Unions, Celent compares a range of solutions that have implementations primarily with smaller credit unions, specifically those in which more than 90% of the credit union customers have assets less than US$500 million. Celent has created a map of core banking vendors and then ranks these vendors on its ABCD analysis. XCelent awards are given out to the leading solutions within four categories.
Last year, around 10% of credit unions sought to switch their core system, up from historical averages of 4–5%. Opportunity exists where smaller credit unions look to upgrade an outdated legacy system or to consolidate processing to a single vendor following a merger or acquisition.
According to Bart Narter, Celent Senior Vice President and coauthor of the report, “The core banking market for credit unions looks increasingly more complex, with product sets and channel offerings becoming a crucial landscape for competing in an ever-expanding financial services industry. Credit unions are continually looking to maximize their product offerings with more efficient and flexible core systems.”
This is one of two reports covering core banking solutions for credit unions. The second report, Core Banking Solutions for Large Credit Unions, will look at vendors with implementations in larger credit unions, specifically those in which at least 10% of their customer base has more than $500 million in assets.