For banks and financial institutions, technology modernization is the need of the hour. It is always seen as risky, but adopting a suitable approach can largely mitigate the risks.

Over the last few years, the financial services industry has seen the emergence of neo-banks and fintechs that offer financial services over a digital channel as an alternative to the traditional brick-and-mortar and branch-driven banks.

Adding to this, there is an increased customer demand from Millennials and Gen Z for personalized and superior digital channel experiences. This demand is driven largely by the experiences they’ve enjoyed at the hands of those e-commerce giants, transport aggregators and other service providers — for instance, large e-tailers track customer behavior during recurring interactions and use that data to personalize offerings to their customers. Recurring interactions create more data that companies use to design more relevant and superior experiences. Modernization or replacement of core applications is the way banks mitigate challenges and meet their objectives.

This whitepaper examines different approaches to modernization and ways to mitigate the risk associated with each approach.