How Banks Choose New Technologies and Providers
While the rise of open banking enables faster implementation of third-party technologies, 93% of institutions preferred to get as much technology from one provider as possible, making selecting the right core provider even more imperative.
Considering which factors drive decision-making, bankers most highly valued overall product suite and functionality, followed closely by cost and potential return on investment.
Overall Product Suite and Functionality
Cost and Potential Return on Investment
Service Reputation of the Provider
Customer Requests
Recommendations from other banks, recommendations from consultants and culture fit ranked lower, but still play a factor in deciding technology investments.
Recommendations from Other Banks
Recommendations from Consultants
Culture Fit
Industry Analysis
The selection of providers’ overall product suite and functionality, followed closely by ROI, makes sense in an environment where community financial institutions face a challenging rate environment and must fight to expand their customer base. However, this year’s responses prove that cost and touted product suite aren’t everything and that some banks need personalized service and attention, a growing shift that industry experts say shouldn’t be undervalued. Service (and culture) can help support the other qualities and ease the relationship over the life of the contract.
On Consultants and Core Conversions
As core conversions are complex and require considerable time and monetary investments, more and more banks are turning to consultants to help guide their determination. While a lower proportion view consultant recommendation as the deciding factor, banks see in consultant expertise the potential to better highlight the other factors and facilitate negotiations. So, while customer requests may instigate the search and other factors determine the decision, recommendations can help to validate and strengthen it.