Analyzing the Global Third-Party Banking Software Market
FREMONT, CA: The Global Third-Party Banking Software market is forecasted to grow at a Compound Annual Growth Rate (CAGR) of 6.66 percent over the period 2012-2016. The key factor which is contributing to this massive growth is the need for standardization while the challenge is the cost involved in the migration to a new system, reports Research and Markets.
According to the report, a significant amount of action needs to be taken with regards to operation management in banks. They need to meet the government’s new and strict regulatory requirements along with the internal directives. Financial institutions need to adjust their business models quickly while also reconsidering their strategy. They are adopting improved information and risk management systems that adhere to regulatory and statutory requirements. It is important to incorporate new modes of banking innovations and operations for better improvements. This requires banks to adopt third-party banking software in the near future while the need for standardization is the main driver of the third-party banking software.
Financial institutions have changed the way they operate and there is an increase in the complexity and rigidity in the banking operations, thus necessitating the need for advanced software which will help them meet all their financial needs easily.
A major challenge faced is the high cost involved in switching over to a new system. The migration from legacy systems to third-party banking software is a critical process as it is considered a daunting task when it comes to large banks. Financial institutions worldwide have avoided replacing their legacy systems with the third-party banking software which resulted in complex network of system which were too expensive, risky and difficult to maintain, that were not able to keep up with the changing needs.