The Intermediary – October 2025 - Flipbook - Page 91
T E C H N O L O GY
Opinion
Transformation
is a process, not
a big bang
H
ow many of us are
siing in companies,
frustrated because
we want to do
something that may
seem simple, but our
tech won’t let us do it?
This is especially the case with
building societies, banks and specialist
lenders that have older legacy systems.
With the pace of change geing
ever faster and challenger banks
able to pivot on a ninepence to get
new products to market, it can be
frustrating to either not be able to
implement the changes you want, or
to have to carry out constant, timeintensive, workarounds to make
them happen.
At this time of global instability,
we are in a continual flux of changes,
oen with legacy platforms that
are just incapable of making either
the number or type of changes,
certainly not without a lot of time and
manpower to do so.
Add to this the number of rate
change fluctuations which seem to
be gathering pace. There have been
18 base rate changes since the start of
2022, 13 moving interest rates up and
five moving them back down again.
We have to go back to 1984-85 to find
the last time there were this many in
one go. But there are many staff who
never managed a mortgage rate change
before 2023, so it’s easy to see why
some lenders are struggling to cope.
So some institutions are faced with
a number of issues. The systems or
platforms are too old to enable you to
do what you want or need them to,
leading to a lack of responsiveness to
customer enquiries where quality of
service then drops. Then you can’t
innovate as your system won’t let you,
so you’re prevented from bringing in
the products and services you want
and need to. This is particularly
frustrating if newer entrants are
running away with more competitive
or flexible products.
The second, developing issue is the
emergence of artificial intelligence
(AI) particularly generative artificial
intelligence (AI). We are increasingly
in a multi-tier society with some
using AI to transform processes,
other tinkering around the edges and
some not knowing where to start. But
– however keen you are to embrace
AI – with an old legacy platform
the challenges of integration can
be impossible.
Arguably the biggest reason to move
off a legacy system is the expertise
and resource required. Many legacy
platforms are built on frameworks
that are decades old and very resource
intense. The current workforce –
particularly the grads coming in - are
just not trained on the tech that these
platforms were built on. They quite
literally require a different language.
Bringing back talent
I actually know of banks who have
had to pull people out of retirement
to come and fix issues on legacy
platforms because none of their
current staff understand the system
well enough.
For many CEOs and CTOs, however,
the thought of changing from a legacy
platform can be intimidating at best.
Understandably, there are worries
about how long it might take, the cost
and the fear about migration and the
potential for losing data.
The way to mitigate this is to look
at the requirements you have to thrive
and meet your goals over the next
few years, then look for the providers
who have the track record and the
longevity to help you. To put your
mind at rest, you need a partner that
MELANIE SPENCER
is growth director
at Target Group
will help you deliver what you need
as efficiently as possible with security
and performance at the heart.
That may not be one standalone
provider as used to be the case. It
is important to have best of breed,
be it for mortgage originations,
servicing, payments, savings,
wealth management or business
processing. Increasingly, you cannot
find everything you need in just one
systems provider, so it is important to
have suppliers who will work together
to seamlessly provide you with the
best solutions.
Fundamentally, any new core
system needs to be agile enough to
enable your bank or building society
to stay ahead of the game. To be able
to introduce those new products and
services quickly and easily when you
want them.
For some organisations you
may have requirements now, but
ambitions to expand and grow into
other areas in the future. In this case
modular solutions are the answer.
This enables an organisation to take
the parts they need immediately,
but work with a provider that can
easily add in new, fully formulated
modules in other product areas as your
business develops.
Going through a transformation is a
process, not a big bang. In many cases
the legacy system still needs to run at
the same time as any new system that
you are implementing. But ultimately
a new flexible system, fit for the
modern era, will create efficiencies,
can reduce headcount and enable an
organisation to focus their resource
where they need it the most, while
expanding and pivoting with ease. ●
October 2025 | The Intermediary
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