success story

Modernization of a legacy core system to make way for open banking initiatives

Secure and scalable solutions through enhanced bank-fintech-partner collaboration

Our client is a prominent American bank holding company and financial services corporation. They are one of the largest small business administration lenders and one of the largest credit card issuers. The bank also provides asset-based lending to private equity and middle-market companies.

Recognizing the need to adapt to the latest industry trends, the bank aimed to implement an Open Banking strategy to enhance collaboration with fintechs and partners, delivering secure, value-added solutions to its customers. However, their legacy core banking system posed several challenges, prompting the need for modernization to support this ambitious initiative.

Virtusa was the bank's partner of choice and helped create and implement the cloud-native architecture aligned to the bank's needs and the required API/Microservices as part of the core system's transformation strategy. With our Engineering First consulting approach, we helped the client modernize their legacy core systems to make way for an open banking initiative implementation.

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The Challenge

The bank's existing core banking system was deeply entrenched in legacy technology, resulting in several critical issues:

  • Integration difficulties: The bank faced significant obstacles in integrating with external partners and fintechs, hindering the deployment of innovative solutions as part of their Open Banking strategy.
  • Lack of flexibility and agility: The outdated legacy core banking system struggled to adapt to new requirements and changes in the market, leading to slower turnaround times and difficulty in integrating new solutions.
  • Modularity issues: The rigid structure of the core system made it challenging to introduce new products and services, impacting the bank's ability to collaborate with fintechs and partners effectively.
  • Limited expertise: The bank lacked the necessary expertise to deliver Open Banking through a cloud-native(API/Microservices) architecture, which relies on APIs and microservices to achieve its goals.
The Solution

It was essential to modernize the client's core systems and streamline their processes to overcome the bank's hurdles and facilitate the implementation of their open banking strategy.

Our comprehensive solution included:

  • Cloud-native architecture: We designed and implemented a cloud-native architecture tailored to the bank's specific needs, incorporating APIs and microservices as part of the core system's transformation strategy.
  • Development and deployment tools: Virtusa developed essential dev and deployment tools to support the transformation of core systems, simplifying the open banking journey and enabling smoother integrations.
  • Automated CI/CD pipeline: A fully automated CI/CD pipeline was implemented for faster, seamless development, testing, and deployment.
  • New product and service launches: We helped launch new products and services as part of the open banking strategy and partnered with fintechs to provide secure and scalable value-added solutions.
Modernization of a legacy core system to make way for open banking initiatives
The Benefit

Successfully delivered and implemented the API/microservices strategy required for open banking implementation around the legacy core banking platform. The successful implementation of our solution yielded significant benefits for the bank:

  • Faster time to market: The new architecture and implementation reduced TAT by ~50%, shrinking the release cycle from 3 months to 2 weeks for launching new products and services in collaboration with partners and fintechs.
  • Increased flexibility: The bank gained the flexibility to launch new products and services with enhanced agility, leveraging best-of-breed capabilities of partner/fintech ecosystem.
  • Efficient development and deployment: Enterprise-wide adoption of tools and standards created for cloud-native application creation significantly saved time for development and deployment.
  • Enhanced customer experience: Improved personalization and real-time data analytics led to a better customer experience, meeting evolving needs and expectations.
  • Technical readiness: The bank is now technically equipped to pursue future digital initiatives, including blockchain, embedded finance, and central bank digital currencies.
Infrastructure that meets the future needs of banking

Learn more about our Core Modernization solution

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