Independent Banker - August 2019 - 55

Before making requests to a core provider, it helps for
banks to be especially clear about what they want and
why. Always think about the goal behind implementing a
particular technology, Strasser says. From there, banks can
decide how important something truly is-and pursue it.
" There's a lot of technology out there, but if it's not going
to drive bottom line to the bank or better the customer
experience or help you diff erentiate, it's just another bell
and whistle, " she says.
While cores are creating the opportunity for fi ntechs
to partner with third parties, the cost to use the bank's
middleware can be a sticking point. Costs can range widely
depending on factors such as the size of the bank, the
relationship with the core and the service itself.
Legacy challenges
Some banks are also limited from a technology perspective
by their reliance on older core systems. " It is diffi cult to
be running legacy systems that are not being updated
regularly and expect integration to happen effi ciently, "
says Jaquish of Wilson Bank & Trust.
Upgrading or switching cores remains an option, of
course, but it can be a major undertaking from a systems,
personnel and time perspective. While such a move could
be advantageous in the long term, various hurdles have
caused some banks to proceed more cautiously, or not
at all.
Another sensitive issue is the long wait time that some
community banks say they're experiencing in being
able to adopt the newer technologies their cores off er.
They're stuck in limbo, they say, as they wait for their core
provider to roll out long-promised enhancements.
Core providers need to get technology into community
banks' hands as quickly as possible, according to John
Buhrmaster, president and chief executive of 1st National
Bank of Scotia, a $475 million-asset bank in Scotia, N.Y.
Buhrmaster off ers the example of his bank's multiyear
process to implement Apple Pay. He also says he found
Bringing new technology
to customers faster
Many community banks express frustration about
their ability to get their hands on new technology
quickly. One option may be for the bank to off er
itself as a beta tester for new technology off erings.
That's what River Valley Bank in Wausau, Wis., did
several years ago after Jack Henry acquired Banno, a
digital banking provider.
" We saw the vision and we understood it and we
believed it would help us diff erentiate and improve
the customer experience, " says Kathy Strasser,
executive vice president and chief operating
off icer of River Valley Bank and its online division,
IncredibleBank. The bank has since worked closely
with Jack Henry to integrate diff erent vendor
solutions to meet its desire for customization.
To be sure, being a beta tester requires significant
back and forth between the bank and the core. For
this to work most eff ectively, the bank needs staff
members who are devoted to testing and validation,
which can be a challenge for small banks from a
resource perspective. But if banks want to innovate,
this may be an area where investing in additional
staff is worthwhile, Strasser says.
" We banks need to take innovation in our own
hands, " she says. " Can the cores help us? Yes. But
you have to get strategic about how you are working
with your core. "
What's more, banks should not be afraid to press
their core for more innovative and cost-eff ective
technology, she says. " Banks don't have to be
satisfied with the status quo, " she says. " I don't think
we ever should be. "
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