At Temenos we have always aimed to keep developing the functionality demanded by the ever-changing banking industry. We also ensure that the technology platforms and strategies we use remain cutting edge, thus helping our clients benefit from technology changes, particularly in the areas of resilience, security, scalability and operating cost reduction. Over the last couple of years, we have increased the rate of technology investment, and we have introduced many fundamental changes.
By making the system deployable on cloud platforms using cloud-native architectural approaches and tools, we enable our customers to adopt flexible scale out approaches, hence reducing technology and operational cost by aligning them to changing business volumes. This approach also enables our clients to take advantage of the security and resilience capabilities offered by the leading cloud service providers like Amazon AWS, Google Cloud and Microsoft Azure. Temenos has been deploying core software on the cloud for clients since 2011, and this technology change represents the next-level of capability in this area.
Not only can Temenos’s core banking solution run natively on the cloud, but it can also run on the three main public clouds natively. This gives banks the ability to choose the cloud provider that is most aligned to their needs. Because the solution can be deployed on a distributed relational database, subsequent migration from one cloud service provider to another is made easier and the possibility of an active-active deployment across multiple cloud providers is opened up.
It has become increasingly important for banks to be able to integrate different systems and providers together to produce better products and seamless user experiences. Although Temenos has always provided extensive capabilities to define and use new APIs, we now offer over 700 documented and supported Open APIs which enable the entire breadth of our solutions’ functionality to be addressed by other systems and providers.
AI is fast becoming a vital ingredient to enable banks to manufacture personalised and relevant customer propositions and to service their clients as efficiently as possible. Temenos helps banks to achieve these goals by embedding its patented eXplainable AI platform across the entire product portfolio, enabling banks to rapidly roll out self-learning technology in a way which satisfies both customers’ and regulators’ needs to understand how decisions have been taken.
Decoupling of Distribution from Manufacturing
During all of these changes, we have continued to build on and accelerate the market-leading functionality for which the system is known.
In January 2020, Temenos announced a new set of innovations effectively decoupling distribution from manufacturing. The use of cloud-native technology enables us to see our applications as a series of Microservices, each of which can be delivered as a container for independent implementation and operation. This has four main impacts on our clients:
1) Quicker time to value for large transformation programs
Many banks find themselves in the position of wishing to be able to undertake large transformation projects to take advantage of new market opportunities, ways of doing business and technology. If the resulting project is monolithic, it can be hard to realize business benefits during the program, and equally hard to change the project to reflect evolving business priorities and opportunities once it has started. Enabling the various elements of the software to be deployed independently can allow banks to realize individual business benefits earlier as the go-live process operates in a progressive, rolling manner, and also to change the roll out plan more easily as needed.
2) Module Level Upgrades
By making the various parts of the system operate in a standalone manner, upgrades can happen at a module-level granularity. This means that banks can easily make smaller, more frequent upgrades, hence enabling them to make earlier use of the new features and capability of the system as they are built and delivered by Temenos. Large, enterprise-wide upgrades still remain possible, but the advantages of module-level upgrades will also become available as clients move to the latest release.
3) Different Deployment Options
Rather than adopting an “all or nothing” approach, banks can choose to keep various elements of in-house or third-party solutions where they add particular competitive advantage. This can either be for the shorter term during a change program, or longer-term if the point solution provides something uniquely valuable. Temenos has responded to this need by designing the microservice landscape to provide both independent banking functionality such as corporate or retail lending facilities, and also “overlay” capabilities such as product and pricing services which can work with legacy systems to offer improved product agility and add new features such as personalised products and more flexible fee bundling.
4) Cloud-native Scale Out Granularity Enhancement
One of the advantages of using cloud-native software for transaction processing systems is to enable the ability to scale out as and when business volumes change. By adopting a microservice-based approach, this scaling out process can be applied to a smaller area of specific functionality, thus offering even further cost and efficiency gains when compared to offerings where the entire solution has to scale out.
Given the degree of change outlined above, and the large benefits which it enables our clients to grasp, we have decided to change the name of our core banking product from Temenos T24 Transact to Temenos Transact. When we adopted the word “Transact” in January 2019 into our core banking product name, we did so because we wanted to express the improvement in transaction processing scalability and efficiency which our recent technology investments result in. We are proud of our T24 heritage, but also realize that T24 is very heavily linked to the integrated, monolithic and modular system approach which underlay it. Although the core system is still integrated, our more recent roll out of the microservice architecture means that it is no longer monolithic in terms of implementation, operation or upgrade, and we wish to stress this new capability by adopting the new product name.