There’s More Than Just the Core: Expanding Digital Capabilities to Meet Customer Demands


When it comes to digital banking solutions, one size does not fit all. While most banks offer the basics – account balances, remote deposits or bill pay – consumers have more and more new specific needs that need custom solutions.

The challenge with rolling out new digital banking options, though, is working with the existing tech structure. Banks can no longer just slap a mobile app on the market that does not integrate with the rest of the institution’s channels. Customers expect to have the same experience across all of a bank’s channels, and a smooth integration with the core platform is critical to a successful digital offering.

Banks often resist adding new digital offerings for one of three reasons: a limited budget, concerns about legacy core capabilities or limited IT talent. However, the growing acceptance of open banking API standards is making it easier for banks of all sizes to upgrade their digital offerings while working within the tech platforms they already have.

Building Digital “Legos” On Top of the Core

When financial institutions look at updating their current digital platforms offerings, they sometimes avoid doing so out of the fear that they will have to undergo an expensive and time-consuming core conversion. A complete core conversion is an arduous task, and for many financial institutions it is not in the budget or they are locked into long-term contracts. However, by leveraging APIs, bankers can explore new solutions without overhauling the core of their technology foundation.

There are innovative ways to add offerings to your current solutions by working with vendors that build onto the core. This offering provides an added layer to the core that services as a digital hub. This concept is commonly used in Europe. The digital hubs provide a toolbox, or “Lego set” of services that can be pieced together to create customer digital solutions for customers in a noninvasive and timely way.

A digital hub’s “legos,” might include services like online account opening, digital transactions, mobile wallet, card services, loan or credit offerings, risk management tools or payments solutions and much more. From there, the bank can piece together the individual building blocks to create nearly infinite niche digital solutions for their specific customer base. For example, a bank looking to better serve a local college campus may combine mobile payments block with card controls and a prepaid account to create a set of services specific to the needs of students.

This concept of a digital hub can work alongside the existing core in one of three ways:

  1. API for full and real-time integration
  2. Database sync for two-way communication
  3. Batch Processing

While API’s have become more widely utilized, it is best to work with your IT team to see which process best aligns with your current infrastructure. APIs provide the best connection – enabling real time interactions and transaction updates. However, depending on a bank’s core, the hub can connect in other ways. It can be set up as a database sync to enable two-way communication at set intervals through the day to update account details. A hub can even support a traditional batch processing set up where account data can be updated overnight.

Use Cases for Digital Banking Enhancements

The enhanced offerings can be applicable to all types of customers and change the way they interact with your financial institution. However, there are a few customer segments that many banks could benefit by building solutions for:

Teens: Parents are looking for ways to give their children their allowance or spending money but in a modernized and more convenient way. Without having to withdraw cash from their accounts or fearfully handing over their own personal card, parents have new options for their teens. Parents would also prefer to use their existing bank and not use alternative providers (prepaid card, money transfer etc) for a same final service. On top of the ease of use, parents want the ability to overlook and set parameters for the spending of their children.

By providing an offering that benefits the parents with ease and oversight, the teens also establish a form of financial independence and financial literacy that will help them in the future. This type of offering utilized through the digital banking platform allows for both physical or digital card, whichever best suits the parent and child. Another bonus is the capability of P2P payments and “social – financial” rebounding between children and parents.

Gig Economy Workers: The way people work and receive payments or run their business has completely changed. Especially with the rise of gig economy workers, there is a great need for a way to access money for workers on the go in multiple industries. Having the ability to both spend and receive payments in a seamless and fast manner is ideal for this segment of workers. This opens up a new level of business banking because gig economy workers are of always compatible with business banking offerings, they need something else with more tailored services. Without completely turning their current business banking offerings upside down, financial institutions can offer a new line of offerings that best fit individuals and company that sit outside of the norm.

Elderly Finances: One of the most important aspects of serving elder from both and banking and familial aspect is maintaining a form of independence. For financial institutions, some of their most loyal customers are those that have grown alongside the institution for years.

To keep those customers and offer solutions that are beneficial to them is a way to keep them around and also their family members or caretakers. Elderly accounts offer a way for the elderly to be involved in their finances but also have the ability for oversight if needed. We see all the time in the news that the elderly are at the forefront of being scammed out of money and oversight of transactions and account updates is a good way for caregivers and family members to minimize and even stop the fraud in its track.

Technology although advancing in the banking sector needs an additional layer of offerings that is secure, seamless and can be easily customized to meet the needs of the unique person it is serving. In addition, more fluid because such solutions add to the core offerings and don’t interfere.

By working with vendors that build onto current solutions, financial institutions can avoid going through the arduous task of a core conversion and get the digital banking offerings that best suit their institution and their customer base.


About the Author:

Arcady Lapiro (left) is Founder and CEO of Agora Services, a provider of robust and customizable cloud-based offering that enables banking customers to utilize and manage accounts in real-time.