Intel Report Core Replacement - Flipbook - Page 25
GLOSSARY
Alternative core: New core providers are an alternative to the legacy core providers and
tend to use a more integrated cloud design with improved API implementation and the ability
to scale services without dramatically increasing costs. But they lack the track record in
handling complex parts of the bank.
APIs: Application programming interfaces allow for banks to connect with third-party tools,
like fintech offerings, providing the ability for the bank’s software to interact with the outside
tool. They give banks ways to offer new products and services without having to innovate.
Artificial intelligence: In banking, AI provides the ability to conduct predictive or learning
analysis by scanning bank data to provide advice, detect fraud or offer solutions to financial
concerns.
Cloud: The use of remote servers to run operations, allowing banks to access data,
incorporate tools, run applications or deliver services through the internet. The cloud offers
scale since banks (or any business) can increase offerings without needing to build new
servers.
Full conversion: Replacing the full legacy core of the bank and transitioning it to a new
provider, whether that’s at a different legacy core provider or an alternative core solution.
Machine learning: A component of AI, machine learning allows computers and systems to
learn tasks and abilities beyond their programming, based on data analysis and algorithms.
Open banking: Also known as open architecture, it’s the concept of allowing a customer
easy access to their data. In practice, it uses APIs as a bridge to third-party financial
technology companies that offer services that the bank may not be able to provide on its
own. This can include giving consumers a full picture of their finances or providing them with
advice based on predictions from their spending.
Predictive analytics: This provides banks the ability to use the data they have access to, in
order to develop algorithms or use machine learning to determine the likelihood of success for
certain plans or strategies.
Split conversion: Replacing part of the legacy core of the bank and transitioning it to a
new provider. While part of the bank utilizes the new core, other parts of the bank remain on
the legacy core.
CORE REPLACEMENT: HOW BANKS ARE REPLACING THEIR CORES | 23