The transformation of a bank’s core system is a significant undertaking, often seen as one of the most complex technology projects in the financial industry. Many banks are now looking to modernize their operations by moving away from outdated systems and transitioning to cloud-based platforms. The SBS Bank project is a prime example of this trend, showcasing how smaller and mid-sized banks are taking steps to update their core systems without having to build everything from scratch in-house.
SBS Bank has initiated a multi-year project to overhaul its core banking system, opting to switch to Engine by Starling, the Software-as-a-Service offering from Starling Group. Deloitte New Zealand has been chosen as the implementation partner for this program, with the goal of kickstarting a transformation that will ultimately enhance the banking experience for customers.
Core banking systems play a crucial role in managing various financial products and services, such as accounts, loans, and transactions. Many banks in the region still rely on legacy platforms, which can be costly and challenging to upgrade. By transitioning to Engine’s cloud-native banking platform, SBS Bank aims to provide its members with digital onboarding, advanced account features, and intelligent money management tools through a new mobile application. Additionally, the bank hopes to streamline internal processes and reduce complexity for its teams, with member-facing changes expected to roll out starting in late 2027.
The shift towards cloud-based core systems is gaining momentum within the banking sector as institutions seek ways to modernize their operations without completely overhauling their existing technology infrastructure. The traditional core systems, built around on-premises setups, often present obstacles to quick and seamless upgrades. Specialized vendors have introduced modular, cloud-hosted core banking platforms as an alternative to large-scale in-house rebuilds or outdated packaged systems.
The SBS Bank project represents a move towards adopting a core platform developed by a digital bank and offered to other institutions as a service. By partnering with Starling for a 10-year agreement, SBS Bank is taking a proactive approach to upgrade its banking systems to the Engine platform. The project will span multiple years and involve changes in technology and service delivery, with Deloitte bringing its expertise to the table to support SBS Bank throughout the program.
As banks continue to explore modular, cloud-based platforms as a means to simplify upgrades and reduce the burden of maintaining legacy systems, the process of core replacement remains a significant challenge that requires meticulous planning and execution. By combining a vendor platform with a systems integrator, banks like SBS Bank can mitigate some of the complexities associated with internal software engineering.
Engine by Starling, the platform chosen by SBS Bank, has a proven track record of powering the daily banking operations of millions of customers globally. While member-facing changes at SBS Bank may not be immediate, the institution is committed to a long-term rebuild of its core systems to enhance the overall banking experience for its customers.
In conclusion, the SBS Bank project exemplifies the industry-wide shift towards modernizing core banking systems through cloud-based platforms and external partnerships. By leveraging innovative technology solutions and strategic collaborations, banks can position themselves for success in a rapidly evolving financial landscape.
