February 9, 2023

Community FIs Need to go Beyond Banking Core Integration to “CICaaS”

by Charles Colt in Banking Core Integration , Fintech 0 comments

Banks and credit unions require more than just integration between their banking core and other systems. Many community financial institutions (FIs) are looking for a connectivity solution that makes integration easy and repeatable, freeing them from the constraints of their core vendor. Once this solution is in place, community FIs often wish to build upon it with a strategy that includes embedded finance and Banking-as-a-Service (BaaS) as well as payments and data management. Handling these issues one at a time adds another set of risks and challenges while addressing them holistically increases the likelihood of success. But to accomplish this, FIs require an integration partner focused exclusively on Financial Services and can offer something we call Customer-Integration-to-the-Core-as-a-Service (CICaaS).

What is CICaaS?

In addition to providing strong technical capabilities, the FI’s integration partner must also provide a broad range of advisory services that address all of the FI’s strategic initiatives. At PortX we refer to this comprehensive solution as Customer-Integration-to-the-Core-as-a-Service (CICaaS)

The basic idea is that banking core integration is the first and most critical part of your roadmap. After completing the first integration, customers can leverage our Open Banking solutions to deliver more integrations with greater speed and savings over time. Once we deliver this important milestone, banking core integration becomes a less arduous undertaking and more of a service that the FI can call.

Our transformation from delivering enterprise connectivity solutions across various systems and industries to providing CICaaS for FIs evolved over the course of five years through a four-phased approach.

Phase 1: Connecting to the Core

We started working with financial services customers (banks and credit unions) that required us to integrate their IT landscape into the banking core. The first few of these integrations were enormously challenging. The core vendor did not always provide adequate documentation or suitable interfaces. This led to a months-long legal and administrative process. 

This process repeated every time we started work with a customer on a new core and we learned that every core involves a fresh set of challenges and constraints. 

Phase 2: Unpacking Many Cores

The more technical, management, and business experience we gained connecting to cores, the more FI and fintech customers we added. This work increasingly matured our integration proficiency from just a few cores to a deep understanding of how to connect to most banking cores and knowledge of their unique drawbacks. We broadened our customer solutions and built a library of reusable APIs and documentation, further streamlining the integration process with known cores.

Phase 3: The Open Banking API Model

As we gained momentum with our customers and core coverage, PortX initiated the development of the “Open Banking API.” This solution standardizes common banking operations in a unified data model applied to all banking cores and exposes it to customer systems through a single API. Behind the scenes, PortX handles the routing and interfaces to the individual cores. 

We took a different approach to development than the general-purpose integration companies with “bank integration accelerators” (recycled code and documentation from individual customer engagements). Our Open Banking API initiative was designed and delivered by a dedicated product management and engineering team in close collaboration with the customer experience engineers who deliver individual integrations. The Open Banking API significantly altered the way we approach our work with customers. They no longer need to focus on the details surrounding banking core integration so much as clearly define their use cases and the specific data exchange required. The Open Banking API handles everything else.

Phase 4: Strategic Core Partnerships

The final barriers to delivering banking integration faster than our competition (our goal is 100x faster) are the procedural hurdles inadvertently created by the banking core vendors themselves. Most of the leading core vendors are painfully aware of the procedural challenges their customers face and are evaluating effective solutions. For this reason, we have partnered with some key core vendors and are in discussions with most others. Our goal for 2023 is to standardize our operating model with banking core partners, similar to our approach with the Open Banking API model.

What’s Next?

We are actively working on our “Integration Quick Connect Program” which will rapidly evolve the Open Banking API, remove banking core procedural barriers through strategic partnerships, and grow and refine our consulting expertise. We are committed to delivering this solution for our customers by:

  • Scaling out our dedicated team of Open Banking API engineers and Product Managers.
  • Hiring top sales and partnership leaders with deep domain expertise in financial services – including many years working for top core vendors (Welcome, Tammy and Shelba!).
  • Continuing to grow our team of best-in-class customer experience architects, developers, and program leaders that our customers have come to love and know they can always count on.

Our goal is to provide FIs with immediate and repeatable access to the data needed to deliver innovative new products for their customers. As we continue to grow with our financial services and fintech customers, we are always challenging ourselves to be faster, better, and more innovative without sacrificing the close relationships and quality commitments we maintain with our customers. 

And of course, we would love to discuss this with you at any time.

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