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The core banking solutions market size is estimated to grow at a CAGR of 16.82% between 2023 and 2028. The market size is forecast to increase by USD 18.47 Billion. The growth of the market depends on several factors, including technological advancements in core banking solutions, rising need for scalability and growing digital transformation.
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In today's business landscape, digital transformation is driving profound changes, reshaping customer experience and challenging traditional norms in banking. Adhering to stringent regulatory compliance standards is essential, particularly in the face of increasing cybersecurity threats. Embracing technological advancements enables banks to innovate and stay competitive amidst fintech disruption. The widespread cloud adoption facilitates flexibility and scalability in operations, benefitting both retail and corporate banking sectors. Moreover, the rise of mobile banking enhances convenience and accessibility for customers. Market analysts play a crucial role in conducting market growth and forecasting, providing valuable insights into industry trends and opportunities for strategic decision-making based on accurate market forecasting.
Technological advancements in core banking solutions are notably driving market growth. The global market has been augmented via the growing digitization of banking offerings. With improvements in technology, the banking sector is constantly striving to undertake contemporary advancements that might be a resource in streamlining daily banking offerings, inclusive of fund transfers, deposits, and loans. Due to the elongated durations of lockdown because of the COVID-19 pandemic in 2020, financial offerings had been impelled to undertake far-flung operation offerings, which surged the call for core solutions, thereby augmenting the enterprise boom.
In addition to this, the increase in the adoption of middle banking technology to enhance purchaser experience by providing remote access to diverse offerings is a major element contributing to the growth of the global market. Hence, the market in focus is expected to witness growth during the forecast period.
The adoption of AI and ML to improve customer experience is an emerging trend shaping the market growth. The growth of the global market may be attributed to the dynamic shift in virtual technology. The emergence of advanced software program offerings, along with AI, Big Data, and the Internet of Things (IoT), are revolutionizing the conventional manner of enterprise operations, which is augmenting the growth of the global market.
Furthermore, with the increase in penetration of smartphones and the advancements of e-commerce, the patron call for virtual banking offerings like cellular wallets, UPI, and net banking will propel the growth of core solutions to streamline the customer experience, which will boost the market in focus during the forecast period.
Risks associated with data migration are a significant challenge hindering the market growth. Data migration can pose the risk of data loss or corruption if not executed meticulously. Inaccurate or incomplete data transfers can lead to significant financial and operational consequences. Data migration can be a complex and resource-intensive process. Banks may incur unexpected costs related to data cleansing, validation, and post-migration reconciliation. Moreover, mapping data from legacy systems to the new platform can be challenging, especially when dealing with different data structures, formats, and coding schemes.
Moreover, comprehensive testing is essential to ensure the accuracy and integrity of migrated data. Inadequate testing can result in unnoticed data errors that may cause problems later. Establishing data governance policies and procedures is essential to mitigate data migration risks. Lack of governance can lead to data quality issues and compliance problems. Thus, the risks associated with data migration will impede the growth of the market during the forecast period.
In the banking sector, various services cater to diverse needs, from traditional retail banking for individual customers to corporate banking for businesses, alongside convenient mobile and internet banking options. The rise of digital payments transforms transactions, while efficient loan management and comprehensive wealth management services enhance financial well-being. Embracing technological advancements and adapting to fintech disruption drive innovation, supported by widespread cloud adoption for scalability and flexibility. Market analysts conduct thorough market growth analysis and market research and growth, offering insights into industry trends and opportunities for strategic decision-making in an ever-evolving landscape.
The market share growth by the on-premises segment will be significant during the forecast period. On-premises deployment provides the bank with full control over its core infrastructure. This allows for extensive customization to align the system with the bank's specific business processes and requirements.
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The on-premises segment was the largest and was valued at USD 5.98 Billion in 2018. On-premises deployment gives them greater control over data security and compliance. Banks can implement stringent security measures and protocols, including access controls, encryption, and monitoring, to protect confidential information and ensure compliance with financial industry regulations and data protection laws. In addition to that, on-premises solutions can be designed with redundancy and failover mechanisms to minimize downtime. However, these investments will bring more opportunities in terms of new products and a competitive advantage in the global market. Thus, these factors will contribute to the growth of the on-premises segment, which will boost the global market during the forecast period.
Large enterprises often have complex financial needs, including cash management, lending, and treasury services. They may use core banking solutions to manage their corporate functions, including payments, collections, and liquidity management. Moreover, core banking solutions can streamline payment processing, reducing manual efforts and errors. Large enterprises often have complex IT ecosystems. Core banking solutions systems can be integrated with other enterprise software, such as ERP, customer relationship management (CRM), and supply chain management systems, to provide a unified view of financial data. Thus, these factors will boost the growth of the large enterprises segment, which will drive the global market during the forecast period.
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North America is estimated to contribute 31% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. The market in North America is expected to rise during the forecast period. The shift towards digital and the increasing demand for online and mobile services are driving banks to modernize their core systems to meet customer expectations for convenience, accessibility, and speed. North American consumers expect personalized and seamless experiences. Core banking solutions enable banks to offer customized products, real-time transactions, and 24/7 access to services. Besides, small and medium enterprises within the region are implementing these solutions for the effective flow of banking.
Moreover, banks are increasingly leveraging data analytics to gain insights into customer behavior, risk management, and operational efficiency. Core banking systems with built-in analytics capabilities facilitate data-driven decision-making. The quickly expanding sizes of enterprises and the increasing number of applications of these solutions are further expected to boost the growth of the regional market during the forecast period.
The market report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Market Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Capgemini Service SAS - The company offers products that help banks reduce the total cost of ownership, and boost operational efficiency and flexibility.
Capital Banking Solutions - The company offers products for retail, corporate, credit unions, private-banking, and neo banks.
Fidelity National Information Services Inc. - The company offers products such as the HORIZON Banking System.
The research report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2018 to 2028.
Core Banking Solutions Market Scope |
|
Report Coverage |
Details |
Page number |
170 |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 16.82% |
Market Growth 2024-2028 |
USD 18,478.38 million |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
14.88 |
Regional analysis |
North America, Europe, APAC, Middle East and Africa, and South America |
Performing market contribution |
North America at 31% |
Key countries |
US, China, Japan, Germany, and UK |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Capgemini Service SAS, Capital Banking Solutions, Computer Services Inc., Fidelity National Information Services Inc., Finacus Solutions Pvt. Ltd., Fiserv Inc., HCL Technologies Ltd., Infosys Ltd., Jack Henry and Associates Inc., NCR Corp., Oracle Corp., SAP SE, Tata Sons Pvt. Ltd., Temenos AG, Trust Systems and Software Pvt. Ltd., Unisys Corp., Virmati Infotech Pvt. Ltd., Vista Equity Partners Management LLC, Websoftex Software Solutions Pvt. Ltd., and Zenith Software Ltd. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements.
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Deployment
7 Market Segmentation by End-user
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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