Core Banking Solutions Market Outlook - 2027
The global core banking solutions market was valued at $9,856.45 million in 2019, and is projected to reach $28,785.85 million by 2027, growing at a CAGR of 14.6% from 2020 to 2027.
Core banking can be termed as a back-end system, which involves processing of banking transactions across various branches of a bank on a single platform. Core banking solutions (CBS) is a bank’s centralized system, responsible for ensuring seamless workflow by automating frontend & backend processes within a bank. Moreover, CBS provides customers with an access to banking facilities from any bank branches across a country and facilitates information across delivery channels. Furthermore, CBS helps banks in processing deposits & withdrawals, enhancing customer relationship management activities and transactions management in core banking solutions industry.
Core banking solutions help banks in reducing operational & support expenses, provide real-time transaction processing, and manage bank accounts using interconnected branches globally. Therefore, this has become the foremost growth factor for the core banking solutions market. In addition, increase in adoption of core banking technologies to modernize banking functionality and increase in focus toward providing better customer services are major factors that propel the growth of the core banking solutions market.
However, lack of awareness toward core banking solutions, huge maintenance costs, and shortage of skilled workforce are some of the factors that limit the core banking solutions market growth.
By Component
Solution is projected as one of the most lucrative segments.
Market Trends Insights
The core banking solutions market is expected to witness several noteworthy trends in the market. One of the significant trends is the rise in the adoption of digital banking infrastructure such as the integration of advanced technologies like cloud computing, artificial intelligence (AI), machine learning (ML), blockchain, and application programming interfaces (APIs) to streamline operations, enhance security, and provide a seamless customer experience. In addition, the increase in the digital transformation has led banks to offer services such as mobile banking, real-time payments, personalized financial products, and enhanced fraud detection, boosting customer satisfaction and loyalty. Furthermore, there is growing trend toward cloud-based core banking systems, driven by their scalability, cost-efficiency, and superior performance, prompting financial institutions to shift from on-premises solutions to cloud platforms. These platforms provide easier updates, enhanced security, and improved disaster recovery capabilities. This trend creates opportunities for core banking software providers and cloud service providers, leading to an increase in Software-as-a-Service (SaaS) offerings in the sector.
Moreover, the increase in the adoption of open banking allows third-party developers to create applications around financial institutions by using APIs to share data securely with authorized providers. This enables customers to access innovative financial products and services through a regulated platform. In addition, there is shift in preference toward instant payment systems and real-time transactions in core banking solutions market has led increase in the need for core banking systems that handle high volumes of real-time payments, including peer-to-peer (P2P) payments, remittances, and business-to-business (B2B) payments. In addition, the surge in the use of core banking systems offers seamless and low-cost payments across borders and currencies. Cybersecurity is essential in core banking due to sensitive financial data and rising cyber threats. Key measures include encryption, multi-factor authentication (MFA), firewalls, IDS/IPS, anti-malware, secure software development, real-time threat monitoring, and DDoS protection. These help banks protect data, comply with regulations, and defend against evolving threats. Furthermore, the rise of Banking-as-a-Service (BaaS) is enabling more financial institutions to offer innovative, cost-effective, and scalable solutions, further transforming the banking landscape. This is expected to drive the growth of the core banking solutions market in the upcoming years.
For instance, on January 9, 2024, Temenos and Deloitte announced a partnership to help US financial institutions modernize core banking and payments in the cloud. This agreement aimed to deliver modern digital experiences faster and at lower costs, leveraging new business models like Instant Payments and Banking-as-a-Service (BaaS). The collaboration enabled a joint go-to-market strategy in the US, targeting large banks and payment players. Deloitte and Temenos offered a modernization approach using best practices for low-risk deployment, combining Deloitte's consulting expertise with Temenos' cloud-native banking platform. Temenos attracted various US financial institutions, including Commerce Bank, Varo Bank, and Convera.
The report focuses on growth prospects, restraints, and trends of the core banking solutions market analysis. The study provides Porter’s five forces analysis to understand the impact of various factors such as bargaining power of suppliers, competitive intensity of competitors, threat of new entrants, threat of substitutes, and bargaining power of buyers on the core banking solutions market.
Application Insights
Core banking solutions (CBS) in core banking solutions market are extensively utilized in multiple banking sectors, such as retail banking, corporate banking, and wealth management. In the realm of retail banking, CBS allows for efficient account handling, transaction execution, and management of customer relationships. For corporate banking, CBS facilitates services like managing loans, trade finance, and overseeing cash operations. Wealth management systems gain from CBS through managing portfolios, tracking assets, and providing investment advice. Moreover, CBS in core banking solutions market is increasingly being integrated with mobile banking, allowing for instant transactions and improving customer interaction. As financial institutions evolve, CBS applications assist in optimizing operations, enhancing customer service, and increasing efficiency within financial services.
Technology Insights
The core banking solutions market is rapidly evolving, driven by advancements in cloud computing, artificial intelligence (AI), and blockchain technology. Cloud-based solutions provide banks with scalable and cost-efficient platforms, enabling better management of operations and data while streamlining processes and reducing costs. AI and machine learning enhance customer experiences by automating services, improving fraud detection, and optimizing decision-making through data analysis. In addition, AI-driven automation reduces operational costs and improves transaction accuracy. Blockchain technology is also reshaping the market, especially in cross-border payments, by offering secure, faster transactions and enhanced transparency. As fintech disrupts traditional banking, banks are modernizing their core banking solutions to stay competitive and meet the rise in demand for digital services. This technological transformation is driving innovation and pushing banks to adapt to new regulatory standards, fueling the growth of the core banking solutions market and positioning it for the future of banking in the core banking solutions industry.
The core banking solutions market is expected to provide numerous opportunities for the new players during the core banking solutions market forecast. The rise of fintech companies and the integration of core banking systems (CBS) with emerging technologies like AI, blockchain, and machine learning present significant opportunities for enhanced banking operations and services. For instance, in May 13, 2024, Temenos launched its Responsible Generative AI solutions as part of its AI-infused banking platform, integrating with Temenos Core and Financial Crime Mitigation (FCM). These solutions, built on extensive R&D and patented Explainable AI (XAI), enable banks to deploy AI faster and safer. Users can generate insights and reports through natural language queries, enhancing efficiency and product management. The solutions address data security and privacy concerns and can be deployed on-premise, on any cloud, or via Temenos SaaS, accelerating the expansion of the core banking solutions market.
Furthermore, the increase in partnership with fintech firms has led to the development of innovative features such as AI-driven fraud detection, predictive analytics for credit scoring, and enhanced customer support. In addition, the surge in the utilization of data analytics and AI for real-time insights and personalized offerings, offers enhanced decision-making and customer engagement, boosting profitability, boosting core banking solutions market growth. For instance, on 15 August 2024, 10x Banking and LTIMindtree announced a global partnership, making LTIMindtree a key implementation partner for 10x’s cloud-native core banking platform. This collaboration aimed to help financial institutions adopt modern core banking systems and accelerate digital transformation. The partnership combined 10x’s Meta core banking platform with LTIMindtree’s industry expertise to support banks' modernization efforts.
Moreover, the increase in the complex regulations has led to the surge in the demand for CBS that manage regulatory compliance, KYC, AML, and data protection, offering CBS with built-in compliance features that attract banks aiming to minimize risk and adhere to evolving global standards. This is expected to offer remunerative opportunities for the growth of the core banking solutions market.
Moreover, the upsurge in the adoption of CBS in rural banks and emerging markets provides enhance operations and customer outreach, as smaller financial institutions in developing regions seek cost-effective, customizable solutions, offering affordable, scalable, and localized CBS tailored to these markets. In addition, the surge in the customization options for personalized banking experiences, like tailored products and targeted campaigns had led providers to offer customer-centric solutions as banks seek to enhance customer experiences. Furthermore, the rise in the adoption of BaaS platforms has led non-banking businesses to provide financial services without needing their own infrastructure, supporting industries like e-commerce and fintech in seamlessly integrating these services. Thus, developing BaaS solutions presents a profitable core banking solutions market opportunity, as fintechs and tech companies look to offer banking services without relying on traditional banks. This is expected to provide lucrative opportunities for the growth of the core banking solutions market.
By Deployment Model
Cloud is projected as one of the fastest growing segments.
Segment review
The core banking solutions market is segmented on the basis of component, deployment model, enterprise size, type, end user, and region. On the basis of component, the market is bifurcated into solution and service. In terms of deployment model, it is divided into on-premise and cloud. Based on enterprise size, the market is segmented into large enterprises and small & medium enterprises (SMEs). By type, it is segmented into enterprise customer solutions, loans, deposits, and others. On the basis of end user, the market is segmented into banks, credit unions & community banks, and others. Region wise, the market is analyzed across North America, Europe, Asia-Pacific, and LAMEA.
For instance, on January 30, 2024, SBS (ex-Sopra Banking Software) renewed and expanded its partnership with Argenta, a leading bank in Belgium and the Netherlands with over 1.7 million clients. The renewed 5-year agreement ensured Argenta's continued access to the SBS Banking Platform, enabling the bank to streamline operations, deliver seamless digital experiences, and enhance customer engagement. This decision highlighted the deep trust and collaboration between the organizations, with SBS committed to providing cutting-edge technology to help Argenta stay competitive and drive digital transformation.
On the basis of deployment model, the cloud segment was the fastest growing segment in 2019, and is projected to maintain its dominance during the forecast period. Moreover, surge in use of cloud computing technology through software-as-a-service (SaaS) to help banks in securing storage & transaction processing further boosts demand for this segment.
By Enterprise Size
Large Enterprises accounted for the largest market share in 2019.
Competitive Analysis
The report analyses the profiles of key players operating in the core banking solutions market include Capital Banking Solutions, EdgeVerve Systems Limited, Finastra, FIS, Fiserv, Inc., NCR Corporation, Oracle, SAP SE, Tata Consultancy Services Limited, and Temenos Headquarters SA. These key players have adopted various strategies, such as product portfolio expansion, mergers & acquisitions, agreements, geographical expansion, and collaborations, to increase their market penetration and strengthen their foothold in the core banking solutions market.
Recent Partnerships/Product launches in the Market
On August 6, 2024, Zafin partnered with 10x Banking to help banks modernize their core systems incrementally, reducing disruption and delivering immediate value. This collaboration combined Zafin’s SaaS core modernization solutions with 10x Banking’s cloud-native platform, allowing banks to manage pricing and products across multiple core systems through a single interface. This approach enabled banks to work more agilely, bring new products to market faster, and reduce costs.
On July 29, 2024, 10x Banking launched its new core technology category, the 'meta core,' designed to accelerate banks' and financial services' transformation. This follows a $45 million funding round in January, led by BlackRock and J.P. Morgan. The meta core addresses legacy core challenges and simplifies cloud-native transformation. 10x Banking powers institutions like Chase UK, Westpac, and Old Mutual, supporting millions of customers globally.
On May 22, 2024, Intellect Design Arena Ltd launched its Intellect Digital Core (IDC) for Cooperative Banks in India. This enterprise-grade banking technology solution, built on the eMACH.ai platform, aimed to help cooperative banks overcome challenges and compete in the digital banking landscape. The RBI's 2022-23 report highlighted the importance of technological upgrades for these banks. With three decades of expertise, Intellect offered this advanced technology on a subscription basis, emphasizing 'Design Thinking' to drive growth and innovation.
On November 25, 2024, Fusion Bank in Hong Kong launched its next-generation core banking system, built on WeBank’s digital banking technology framework, following successful data migration and business validation. partnership aimed to offer enhanced operational efficiency and adaptability. The project integrated over 150 subsystems across five core banking areas within 10 months. This collaboration demonstrated effective cross-border FinTech cooperation and provided a reference for digital transformation in Hong Kong’s financial sector. Moving forward, WeBank will leverage this success to offer digital banking solutions globally.
On February 21, 2025, Fusion Bank announced the completion of its core banking system migration, supported by Tencent Cloud and WeBank's digital banking technology. The project integrated over 150 subsystems across key banking areas within 10 months. Tencent Cloud provided a robust environment with TDSQL and TCE, ensuring smooth data transfers and minimal user disruption. This migration set a new industry benchmark for core banking upgrades in Hong Kong.
On October 10, 2023, SBS launched its next-generation, modular, real-time, fully cloud-native core banking platform, marking a significant milestone. After an 18-month beta launch, the SBP Core Platform, with its open architecture, high scalability, and integrated AI capabilities, became available to all customers. Delivered as a SaaS solution, it supports a wide range of banking services and integrates with SBS’s Digital Engagement Platform. The platform offers cost efficiency, high security, and seamless updates, enhancing both customer and employee experiences.
On May 22, 2024, Intellect Design Arena Ltd launched its Intellect Digital Core (IDC) for Cooperative Banks in India. This enterprise-grade banking technology solution, built on the eMACH.ai platform, aimed to help cooperative banks overcome challenges and compete in the digital banking landscape. The RBI's 2022-23 report highlighted the importance of technological upgrades for these banks. With three decades of expertise, Intellect offered this advanced technology on a subscription basis, emphasizing 'Design Thinking' to drive growth and innovation.
By Type
Enterprise Customer Solutions is projected as one of the most lucrative segments.
Top impacting factors
Surge in adoption of core banking technology
The banking industry has become a fastest adopter of technologies such as cloud computing, application programming interfaces (APIs), data analytics, artificial intelligence, robotic process automation (RPA), chatbots, machine learning, and blockchain, among others. In addition, with an implementation of core banking solutions, banks are able to perform effective customer analysis while simultaneously enabling customers to carry out their usual banking transactions effectively. Therefore, to modernize banking functionality, several banks are implementing core banking solutions to provide more integrated & value-added services. Hence, adoption & implementation of core banking solutions among banks drive the growth of the core banking solutions market.
Huge maintenance cost & shortage of skilled workforce
Increase in non-availability of low skilled labor, which are needed to perform highly advance tasks in the banking sector has become one of the major factors limiting the market growth. In addition, to maintain unprecedented levels of speed, accuracy, and cost efficiency banking operations with an implementation of core banking solutions is lacking in the banking industry. Moreover, high initial investments & maintenance cost of the software are expected to hamper the core banking solutions market growth.
By End User
Banks accounted for the largest market share in 2019.
Growth in mergers & acquisitions among banks & financial institutions across regions
With growth in core banking mergers & acquisitions, key players are seeking to accelerate their existing product development processes in the market. In addition, banks & financial institutions are adopting new approaches for on-going business operations rather than rebuilding from scratch. Therefore, to meet customer expectations & enhance automated banking services on a single platform, banks & financial institutions require modernization of core banking systems. As a result, while executing mergers & acquisitions to operate faster, smarter, and provide real-time digital customer experience, banks & financial institutions are expected to adopt & implement core banking solutions. These factors, therefore, anticipated to create an immense opportunity to the core banking solutions market in upcoming years.
By Region
Asia-Pacific would exhibit the highest CAGR of 16.3% during 2020-2027.
Key benefits for stakeholders
- The study provides in-depth analysis of the global core banking solutions market share along with current & future trends to illustrate the imminent investment pockets.
- Information about key drivers, restrains, and opportunities and their impact analysis on the core banking solutions market size are provided in the report.
- Porter’s five forces analysis illustrates the potency of buyers and suppliers operating in the core banking solutions market.
- An extensive analysis of the key segments of the industry helps to understand the global core banking solutions market trends.
- The quantitative analysis of the global core banking solutions market from 2020 to 2027 is provided to determine the market potential.
Core Banking Solutions Market Report Highlights
| Aspects | Details |
 By COMPONENT |
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 By DEPLOYMENT MODEL |
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 By ENTERPRISE SIZE |
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 By Type |
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 By END USER |
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 By Region |
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 By LAMEA |
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 Key Market Players | FISERV, INC., FINASTRA, SAP SE, ORACLE, NCR CORPORATION, EDGEVERVE SYSTEMS LIMITED, TEMENOS HEADQUARTERS SA, CAPITAL BANKING SOLUTIONS, TATA CONSULTANCY SERVICES LIMITED, FIS |
Analyst Review
Increase in adoption of core banking solutions to facilitate easy flow of banking activities, remote monitoring of transactional activities, and enhanced risk management from any branch of the bank are the major factors that propel global core banking solutions market. In addition, the COVID-19 outbreak has a significant impact on the core banking solutions market as several governments have imposed lockdowns & business shutdowns and banks aim at investing in technologies and expanding their offerings in the market. Moreover, to curb the spread of coronavirus, banks are adopting core banking solutions & implementing it in their existing business operations to continue providing banking services during the pandemic situation. However, a considerable number of banks perceive that they have minimum core banking solutions exposure. This scenario is changing, and 2019 has witnessed an increase in sales of core banking solutions, owing to rise in mergers & acquisitions among banks & financial institutions across regions, which are demanding core banking solutions, which has led to innovations & new trends in the core banking solutions industry.
The core banking solutions market is consolidated with the presence of regional vendors such as FIS, Fiserv, Inc., and NCR Corporation. North America and Europe dominated the core banking solutions market, in terms of revenue in 2019, and are expected to retain their dominance during the forecast period. However, Asia-Pacific is expected to experience significant growth in the future, owing to emerging economies, increase in government support toward banking & financial institutions for implementing core banking solutions in the region. Furthermore, the core banking solutions market is particularly brisk in countries such as India, Australia, China, Japan, Indonesia, Korea, Hong Kong, and Singapore, with high GDP growth and rise in per capita income.
Some key players profiled in the report include Capital Banking Solutions, EdgeVerve Systems Limited, Finastra, Oracle, SAP SE, Tata Consultancy Services Limited, and Temenos Headquarters SA. These players have adopted various strategies to increase their market penetration and strengthen their position in the industry.
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