The Growth Of The Core Banking Software Market: Opportunities And Challenges

Core Banking Software Industry Overview

The global core banking software market size was valued at USD 10.89 billion in 2022 and is anticipated to grow at a compound annual growth rate (CAGR) of 9.3% from 2023 to 2030. The market growth can be attributed to the rising incorporation of technology to provide core banking operations and services. Digitized operations have enhanced banking service quality and reduced turnover times. Technological advancements have also enabled financial institutions to adapt to changing customer needs, a prominent example being the provision of omnichannel banking access.

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In addition to providing customers the ability to manage accounts remotely through online banking and mobile channels, core banking software has multiple other benefits. Core banking software solutions connect multiple branches to a centralized system making them interconnected and allowing for efficient search and comparison of data. Banks can leverage core banking software to analyze data and improve internal processes. Moreover, through transaction monitoring and screening, core banking solutions help detect and prevent money laundering.

The pace of technological innovation and adoption has gathered tremendous pace across sectors. Integrating the latest technologies, such as generative artificial intelligence in banking and financial activities, can help firms differentiate from the competition and gain a competitive edge. According to a study conducted by Accenture in March 2023, covering over 49,000 customers, 67% mentioned using branch services for very specific and complex problems that require physical presence. Moreover, the survey estimates that banks can boost revenue by up to 20% through better engagement with primary customers.

Core banking digitization can make banking transactions more effective. A unified system enables seamless access to customer information and reduces the need for redundant data entry, resulting in faster and more accurate transactions. Additionally, core banking systems support real-time processing, enable instant account and transaction updates, and faster payments and fund transfers. Furthermore, core banking software improves overall security features and fraud detection mechanisms, ensuring the safety of transactions and protecting customers from potential risks.

However, the complex nature of banking operations may pose some challenges. Several financial institutions are in the early phases of transitioning from legacy systems to digital solutions for better banking. However, the transition is bringing about privacy concerns associated with making the shift which plagues the growth of the market. However, core banking solution providers are innovating and providing customized solutions to meet the needs of banks and financial institutions.

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Core Banking Software Market Segmentation

Grand View Research has segmented the global core banking software market based on solution, service, deployment, end-use, and region.

Core Banking Software Solution Outlook (Revenue, USD Million, 2017 – 2030)
• Deposits
• Loans
• Enterprise Customer Solutions
• Others

Core Banking Software Service Outlook (Revenue, USD Million, 2017 – 2030)
• Professional Service
• Managed Service

Core Banking Software Deployment Outlook (Revenue, USD Million, 2017 – 2030)
• Cloud
• On-premise

Core Banking Software End-use Outlook (Revenue, USD Million, 2017 – 2030)
• Banks
• Financial Institutions
• Others

Core Banking Software Regional Outlook (Revenue, USD Million, 2017 – 2030)
• North America
o U.S.
o Canada
• Europe
o Germany
o U.K.
o France
• Asia Pacific
o China
o India
o Japan
o Australia
o South Korea
• Latin America
o Brazil
o Mexico
• Middle East & Africa
o Kingdom of Saudi Arabia (KSA)
o UAE
o South Africa

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Key Companies profiled:
• Capgemini
• Finastra
• FIS
• Fiserv, Inc.
• HCL Technologies Limited
• Infosys Limited
• Jack Henry & Associates, Inc.
• Oracle Corporation
• Temenos Group
• Unisys