Being Digital At The Core

Finacle Core Banking Solution

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Can You Build
Your Digital Future
With Your Core
Banking Solution?
Incumbent banks need a core that can drive
transformation

Around the world, banks are facing multiple challenges. Digital technologies,
new and nimble competition and increasing regulation are three of four
forces creating a huge wave of disruption. The fourth is the digital consumer-
empowered, demanding and savvy – who is interacting with her bank in
completely new ways. About fifteen years ago, more than half of all banking
transactions occurred within the branch network; today, that number is down
to less than 10 percent, thanks to an array of digital channels. The bigger news
however is that by 2022, thanks to open banking, at least one in two transactions
is likely to flow through channels owned not by banks but by third parties such
as Google, Amazon and a multitude of Fintech and digital ecosystems.

Most banks are reacting to digital disruption with short-term quick fixes, mainly
at the customer interface. Tactics that operate at the periphery are expedient,
but certainly do not deliver the full impact of digital transformation. For that,
banks need a dual approach – exploit the greenfield opportunities of digital
technology as well as apply it to the legacy core to improve its effectiveness
manifold. Without that, incumbents run the risk of falling behind the challenger
banks and other new rivals, whose cost to income ratio, at less than 30 percent,
is substantially lower than their own.

Legacy Core -
A drag on digital transformation
• Closed systems – not open banking friendly

• Monolithic design – hard to maintain, harder to upgrade

• Outdated architecture – not ready for cloud deployment

• Low automation – costs a lot more to run the business

• Analytical friction – takes huge effort to extract and process

data into insight

Banks spend as much as 75.4 percent of their

annual IT budgets in supporting existing business
operations and organic growth1.
1. Celent,BofA Merrill Lynch Global Research 3 | External Document © 2019 EdgeVerve Systems Limited
A Core For The Digital World
Seven must-haves in a digital core
Our experience with client banks in more than a hundred countries reveals that for successful digital transformation,
a bank’s core must have the following seven attributes:

1 Full openness: The core must be geared for the reality of open banking. It must support open
APIs (Application Programming Interface) to enable the bank’s integration within its ecosystem
of customers, developers and business partners. An open core allows the bank to tap the
innovation capabilities of partners as well as complementary offerings from their stable. This
way it creates fresh revenue streams and the necessary competitive edge to succeed in an
open era.

2
Massive scalability: Transactions have grown exponentially with the arrival of digital banking.
This trend will only intensify in the open banking era when banking embeds further into
lifestyle, and several banks consolidate into fewer entities. With more transactions hitting the
banking core more frequently, it needs to be able to scale up quickly, and at minimal cost.

3
Extensive automation: Automating core banking processes is the only way to meet the
aggressive new cost-income benchmarks. By digitizing processes, the bank takes a load off the
branch workforce to allow them to focus on customer engagement and other value creating
activities.

4
Continuous, personalized product innovation: Personalization for a segment of one is
truly possible now thanks to digital technology. With every customer being able to design a
product or service that serves her alone, the core has to prepare for product design passing
from the hands of product managers to consumers. This means being flexible enough to allow
consumers to tweak products not once but several times to fit each significant life moment.

5
Embedded intelligence for harnessing data: The core is the largest repository of transaction
data that is used for everything from customer engagement to risk management. Apart from
providing insight to other applications, or to empower customers, employees and partners,
the core should also embed it within its workflows to enhance its own processes. For example,
early insights on loans which are likely to default.

6
Total cloud readiness: Operating from the cloud right from the start, new age banks are
setting the benchmarks for agility and cost efficiency. Incumbent banks transitioning on
premise assets to the cloud need a core banking solution that accelerates the move in order to
realize its benefits.

Componentized design: Componentization allows a core to evolve frequently so it can

7 keep pace with the dynamic environment as well as support change within the bank. It offers
unmatched agility so banks can modernize at a pace that suits their goals. Frequent, rapid
evolution or progressive modernization also mitigates the risk of core transformation.

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Finacle Core Banking
An industry-leading core for the digital world
Built on advanced architecture, Finacle Core Banking solution offers a comprehensive suite of capabilities to power banks’
digital transformation.

With Finacle Core Banking Solution, banks gain a comprehensive set of capabilities, including flexible product factories,
extensive parameterization, product bundling and reusable business components, to help accelerate innovation led growth.

With its real-time processing engine, open APIs, and embedded customer insights, Finacle delivers one of the most advanced
digital banking foundations to engage demanding consumers.

Finacle leverages both established and emerging automation technologies to achieve operational excellence. It’s no wonder
then that Finacle clients enjoy a cost income ratio that is 7.2 percentage2 points lower compared to other banks.

Today, Finacle Core Banking Solution, consistently rated as a leader in the industry, powers the delivery of simpler, faster, safer
and fully personalized banking to more than a billion consumers in over 100 countries.

A global solution built on the experience of servicing 1.05 billion customers – estimated
to be nearly 16.5 percent of the world’s adult banked population.3

100
Countries
1.05 billion
Consumers

81,560
Branches
1.3 billion
Accounts

Assessment against the top 1,250 banks in the world covered by The Banker.
2

3
Infosys Finacle analysis using the world bank data on world’s adult banked population.

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Many Journeys, One Platform
Designed to be as unique as you are
Finacle Core Banking Solution meets the meets the needs of any type of bank, at any stage of their journey. Our
comprehensive, versatile platform powers innovation and growth for financial institutions, whether you are traditional or
emerging, global or local, physical or digital, or a medley.

Finacle is the platform of choice for:

Well-established financial institutions that Digital-only banks without a branch network that
seek comprehensive digitization across front- seek to integrate into their customers’ digital lives.
to-back enterprise systems. Prized partners: Discover Financial Services, Marcus by
Prized partners: DBS, ICICI Bank, Standard Bank, Goldman Sachs, DBS DigiBank,
Emirates NBD, Equity Bank Nequi by Bancolombia

Financial technology organizations Non-financial companies, such as telcos and

(FinTech) transforming financial services retailers, who are leveraging connectivity to help
through emerging technology. customers manage their finances.
Prized partner: Paytm Prized partner: India Post

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Our Promise -
To Make You Digital To The Core
Digitally transform inside out
Finacle helps banks turn digital to the core, enabling them to fulfill current and future requirements with ease.

With Finacle, you can be assured of being ready for innovation-led growth, enhanced customer engagements, and leverage
automation to achieve operational excellence.

Comprehensive
capabilities Openness and agility for
innovation led growth
Finacle approach to your
digital transformation

Transformation
success makers

Advanced Deeper customer

digital platform engagements

Ubiquitous automation &

Risk mitigated operational excellence
transformation

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The Finacle Approach For Successful Digital Transformation

1. Comprehensive Capabilities To Power Current

And Emerging Requirements
Launch Products On Demand
Today’s customers have high expectations from their banks. They want to consume innovative, and personalized products
and services in a smooth and seamless experience that remains consistent across touch points. Finacle Core Banking solution
with its comprehensive capabilities enables banks to take new products in the retail, corporate, private and Islamic Banking to
market in quick time. Different types of banks, micro finance institutions, Fintech companies and non-banking providers can
leverage only the components they need to expand their product range on demand.

Product factory:
Business users can leverage several thousand parameters and reusable
business rules to configure products and services.

Customer-led design:
End consumers can design and personalize products and services on
digital channels, while business users can also offer tailor-made products in
assisted channels.

Define once, reuse many times:

Product templates enable banks to create new products, modify existing
ones, and rapidly deploy new innovations in market.

Configure third party products

Banks may set up third party products and configure rules to support them
seamlessly.

Configure product bundles

Banks can bundle variety of products and services to enable right-sell.

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 Realize Your Strategy with a
Comprehensive and Advanced Platform

D EP O SIT S

Retail Banking
Business Banking
Corporate Banking
NCE

Private Banking

END L
Islamic Banking
A
FI N

N I
E

G
D A
TR

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2. Advanced Platform
Be part of the new economy
Banks are transforming themselves as digital businesses. Finacle helps them get there by increasing openness,
agility and scalability.

Componentized structure:
• Finacle offers an optimal mix of componentization granularity and API based integration of components.
• Banks may deploy and upgrade Finacle solutions selectively and progressively.

Open APIs:
• Finacle ,with its extensive RESTful APIs enables co-innovation with the external ecosystem.
• Banks can set up API stores, embed services in corporate customers’ business applications, engage fintechs and digital ecosystems,
and drive co-innovation with developer community through hackathons.

Cloud ready:
• Finacle supports production, development and testing across private, hybrid and public cloud environments.
• Banks can go cloud-first on Finacle, which is available on AWS, MS Azure, Oracle, IBM and supports progressive migration to the
public cloud.

Technology platform agnostic:

• Banks may run Finacle on a number of technology platforms such as IBM, Oracle, Intel, HP, Unix, Linux and mainframe.
• It offers complete stack open source technologies such as JBOSS app server, RHEL, JBPM, Drools, and Enterprise DB.
• It supports exadata range along with database options of Oracle, Enterprise DB and DB2.

24x7 real-time processing:

• Finacle is a fully real-time core banking solution that processes and posts transactions in real-time, on own and third party channels of
origination including Facebook, WhatsApp, Google Wallet, etc.
• Apart from banking on digital channels, select banks have leveraged the capability to have 24*7 open branches.

Proven scalability:
• Finacle has proven availability and performance in both simulated and live client environments.
• In a test environment, it is proven to process six times the volume of transactions processed by the entire U.S. banking system.
• Finacle’s largest live core banking implementation powers over 700 million accounts.

GUI tools-led extensibility:

• Finacle enables banks to extend the platform using a set of GUI based tools, without touching the base product source code.
• They can customize everything from business services, business processes and workflows, reports and user interfaces.

Multi* capabilities:
• Finacle with its multi-entity, multi-currency, multilingual, multi-time zone capabilities, supports multinational operations.
• For instance, Equity Bank, a leading commercial Kenyan bank runs on a single instance of Finacle across five countries, five languages,
five currencies and three time zones.

Robust security:
• Finacle security architecture protects infrastructure, data, and application layers.
• Capabilities at application level include identity and access management, user role management, limits, and exception management.
• Finacle is certified for several international and regional standards by a leading audit firm.

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 Robust Foundation for your digital Future

Componentized Open Cloud Technology Truly 24x7

Structure APIs Ready Platform Real-time
Choice Processing

Massive GUI tools led Multi Highly

Scalability extensibility Capabilities Secure

Powering massive scalability for a digital future

India Post
Finacle powering world’s largest core banking installation
One of the world’s largest postal service with a network of over 154,000 post

720 Mn
offices and 90% market presence in rural areas within India, runs on Finacle to
power its huge transaction volumes for its customer base of 356.7 million.
Accounts digitized

Certified lab results

Finacle, benchmarked for its multifold scalability
Finacle core banking solution was benchmarked to
process six times the volume of transactions currently
processed by the entire US banking system. This is close to
double the number of transactions achieved by any core
>50,000 1.9 Bn
Transactions / second Accounts
banking product in the industry.4

A benchmark exercise audited and reviewed by the global audit firm, Ernst & Young, 2014
4

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3. Risk Mitigated Transformation
Deploy in any place, at any pace
A flexible core makes any kind of transformation – big bang switchover, or progressive deployment – simpler and faster, and
supports all strategies, including comprehensive digitization, bank-in-a-bank, and digital-only bank.

The key three pillars of our risk mitigated transformation approach are:

1 2 3
Reference bank models Progressive deployments and Agile delivery model
• Reference bank models for emerging upgrades • Designed to help banks practice agile
and developed markets, packaged • Componentized design offers implementation, wherein they can
with global best practices, innovations customers the flexibility to pick and quickly deploy only the components
and localized solutions, enable choose system components, for they need at first and enhance them
implementation in record time. example only the Finacle retail banking later as required.
• Localization components built on top solution or a single module such as • Provides the capability to do
of the base product support regional demand deposits. continuous integration and continuous
requirements, for example both federal • Business priority mapping and value deployment.
and state requirements in 50 states in realization models continually assess
the U.S. transformation progress and outcomes.

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 Renovating for innovation and By the numbers3
world-class service
65%
Discover Financial Services decrease in account-
servicing costs
In addition to traditional banks, Infosys Finacle has helped several new-
age direct banks progress towards truly digital banking. Discover Financial
Services (DFS) is one of the largest direct banks with over $80.6 billion
30%
reduction in account
assets. It is one of most recognized brands in the United States.
opening time and effort
DFS had a complex legacy IT environment supporting 100 discrete IT
services, 75 of which required point-to-point integration. Many of these 20 to 1
services were also using legacy system providers. This fragmented system Reduced customer service
agent interfaces from 20 to 1
led to many data inconsistencies. After undertaking a progressive digital
transformation with Finacle, DFS has achieved significant acceleration
in many of its key business processes. Additionally, by automating 40%
compliance requirements, DFS has significantly reduced the time and cost decrease in clicks required to
process customer requests
of compliance.

Building on the success of automating deposits and personal loans, student 6 steps
loan portfolios, the bank is now implementing Finacle for modernizing its line Reduced account-opening
of credit business. process from 20 steps to
6 steps
This is just a glimpse of what a truly digital transformation looks like when
powered by Finacle. Our comprehensive and flexible suite of products
3
Celent Model Bank 2015, Gareth Lodge, James M. O’Neill’.
drives transformation for clientele of all types and sizes, and we are
committed to making a success story out of every engagement.

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4. Openness and Agility for Innovation Led Growth
Sharpen your competitive edge
Finacle promises to give banks the flexibility to launch and update products and services at a pace that drives continuous
innovation and growth.

The key accelerators from Finacle suite for an innovation led growth are:

Global core
Finacle’s global core has the following three layers:

• Single base (globally) packs innovations and best practices from 100 countries.
• Localization components support adherence to local practices and compliance requirements.
• Customization components extend the solution independently with capabilities specific to customers.

Key innovation enablers

1 2 3
Inside-out enablers include: Outside-in enablers include: Focus on innovation through
Product Factories and Extensive Finacle App Center: co innovation:
Parameterization: • Finacle Marketplace features innovative Finacle has created several platforms
• Banks can create and deploy new solutions developed by an ecosystem to co-innovate with client and partner
products in days instead of months. of large partners, and startups.
ecosystems. Some of these include -
• Product factories with more than • The App Center gives banks easy
several thousand business parameters access to innovations developed • Finacle Client Advisory Board
enable quick and easy configuration of around Finacle solutions. (FCAB): A platform for co-innovation,
products and services. API Store: FCAB is an executive forum to discuss
Product Bundling: • Finacle API store, in partnership with and validate Finacle product strategy
• The product configurator can Open Bank Project, provides banks a and roadmap.
configure product suites for individual comprehensive suite of open APIs for • Banking Visionary Council: Enabling
customers or segments. ease of collaboration with external clients leverage emerging industry
• Customers can design their own developer ecosystem. trends.
product bundles by choosing from a • With this, banks can accelerate their • FinTech Connect Council:
selection of mandatory and optional
digital offerings by leveraging a set of Collaborating for building of an
products.
pre-built banking APIs and a global ecosystem of banks, startups and
• Banks can define structured ecosystem of 3rd party applications Finacle, thus accelerating innovation
products linked to various
and services. through bank-FinTech partnerships.
underlying assets, including
currency, interest benchmarks, Blockchain Based Networks: • Innovation Research: For example,
equities, bonds and indices. • Banks can benefit from production- for the past ten years, Finacle has
ready blockchain solutions for partnered with Efma for joint research,
remittances, trade finance and digital therefore tracking innovation trends
identity management.
and practices being adopted by
• For instance - Emirates NBD and ICICI leading banks globally
Bank deployed a blockchain based
• Innovation Awards: A platform to
remittance and trade finance network
celebrate and share success stories
between UAE and India.
around innovations leveraging
Finacle solutions within Finacle client
community.

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 Enabling adoption of emerging business models

Paytm
Paytm, India’s largest mobile
payments and commerce
platform, has leveraged Finacle
APIs to power marketplace
banking and introduce
complementary products like
overdraft loans and deposits, in
partnership with leading banks
such as ICICI and IndusInd Bank.

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5. Deeper Customer Engagement
Turn customer data into customer delight
Finacle Core Banking sharpens both insight and action with a unified customer view. Using this truly digital platform,
banks can deliver personalized, integrated experiences to customers.

Customer centric product design:

• Finacle enables customer requirements to lead product design.
• It also enables moving towards self-service to accelerate digital adoption.
• Example, a digital-only U.S. bank and user of Finacle Retail Loans module allowed customers
to design not just the loan but also the servicing lifecycle, including the repayment structure
to differentiate itself in a crowded market.

Unified 360-degree customer view:

• Banks can use customer information to take better decisions and real-time insight from
interactions to predict the next best step.
• They can personalize products and services to individual needs.
• Finacle supports features like differential relationship pricing to improve customer loyalty.

Insight throughout the customer journey:

• Embedded analytical capabilities and unique engagement architecture combine to provide
contextual and personalized interactions and experiences, on all channels and devices.
• Finacle helped a bank in Oman to deploy embedded analytics and gain deeper insights
throughout the customer journey. The bank leveraged analytics in areas including non-
performing loans, limits and collaterals analysis, Customer Lifetime Value, ATM analysis,
channel performance etc.

AI based customer experiences:

• Underpinned by AI platform Infosys Nia and the Finacle Marketplace, the solution facilitates
conversational banking and commerce.
• As part of the ecosystem offerings, our partners enable a natural language based
e-commerce solution pre-integrated with over 40 merchants for services such as hotel
bookings, flight bookings, cab bookings (such as Uber), events booking, movie ticketing,
among others.

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6. Ubiquitous Automation and Operational
Excellence to Drive Down Costs
Embrace next-gen banking with AI and automation
Banks are under constant pressure to reduce operating costs, while meeting customers’ expectations for better products,
services and experiences. Finacle enables extensive automation to help clients meet these goals.

Traditional automation levers

• Finacle employs traditional levers, such as rule-based, API-driven Straight Through Processing and BPM led
process orchestration to automate a range of activities.
AI and Robotic process automation
• Finacle empowers banks with an array of AI-based platforms and applications. For instance, a proprietary
robotic process automation tool leveraging the Infosys Automation Platform has helped banks cut down
cross-application process execution time significantly.
• Banks can also leverage Infosys Nia, to deploy AI capabilities in several ways. For example, an AI based
debt management can help predict portfolio delinquencies and take preventive measures to reduce
portfolio risks.
Inter organization automation
• Finacle leverages blockchain technology to help the banks automate their inter-organization processes.
Today, Finacle is working with multiple clients to deploy blockchain-based networks for banking processes.
• An example is the Finacle Trade Connect, which digitizes trade finance business processes, including
validation of ownership, certification of documents and payments, while working on a distributed, trusted
and shared network.
Multi country operational hubs
• Finacle allows banks to deploy regional/ international processing hubs for different capabilities (such as
lending hub) and thereby reduce duplicate effort across business units.
• Multi-entity parameters help to create customized, unique experiences in each region.

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Experience That Speaks for Itself
An Industry Leading Solution
Year after year, Finacle is chosen as a leader in independent industry assessments
by major analyst firms.

Forrester
Gartner
Rated as a leader in The Forrester Wave™:
Infosys Finacle was named as a leader ,
Global Digital Banking Platforms, Q3 2018
11th time in a row, in the Gartner Magic
Quadrant for Global Retail Core Banking, Rated as a leader in The Forrester Wave™:
June 2018, Vittorio D’Orazio & Don Free Digital Banking Engagement Platforms, Q3 2017

The Most Awarded Solution in the Industry

DBS digibank initiative for
transformation with Finacle
Core Banking solution

India Post- Best financial United Bank for Africa and Best Tech Overhaul Project
inclusion project leveraging Infosys Finacle for core banking India Post - World’s largest Core
Finacle Core Banking transformation on the cloud banking transformation

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Power Your
Digital Strategy
With A Robust
Foundation
The digital revolution is accelerating. Overcoming the disruption with a
market responsive model and achieving customer centric growth, require
banks to be digital to the core. Join the global community of financial leaders
who are innovating and powering their digital propositions with Finacle.

Are you ready to accelerate your digital journeys?

Contact us today:
[email protected] I www.finacle.com

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About Infosys Finacle
Finacle is the industry-leading digital banking solution suite from EdgeVerve Systems, a wholly owned
product subsidiary of Infosys. Finacle helps traditional and emerging financial institutions drive truly
digital transformation to achieve frictionless customer experiences, larger ecosystem play, insights–
driven interactions and ubiquitous automation. Today, banks in over 100 countries rely on Finacle to
service more than a billion consumers and 1.3 billion accounts.

Finacle solutions address the core banking, omnichannel banking, payments, treasury, origination,
liquidity management, Islamic banking, wealth management, analytics, artificial intelligence, and
blockchain requirements of financial institutions to drive business excellence. An assessment of the
top 1250 banks in the world reveals that institutions powered by the Finacle Core Banking solution,
on average, enjoy 7.2% points lower costs-to-income ratio than others.

For more information, contact [email protected] www.finacle.com

© 2019 EdgeVerve Systems Limited, a wholly owned subsidiary of Infosys, Bangalore, India. All Rights Reserved. This documentation is the sole property of EdgeVerve Systems Limited (“EdgeVerve”).
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