Tobias Unger - Global Banking |  FinanceThe line between traditional banks, fintechs and other technology providers has begun to blur over the past few years. Once viewed as competitors, banks and fintechs are now becoming strategic partners, allowing banks to introduce new offerings and accelerate their time to market without having to build in-house or deploy new solutions. Without investing.

About three-quarters (74%of banks see this type of collaboration as “crucial” to their future of Supra Steria and Supra Banking Software (SBS). 2024 Digital Banking Experience (DBX) Report.

“The organizational lines between banks, fintechs and other third-party technology providers will only continue to blur as banks move away from legacy systems and adopt a SaaS-based approach to digitization,” said. Tobias Unger, Chief Operating Officer of Supra Banking Software.

Supra Banking Software (SBS) has spent more than the last decade. Envisioning how banks and the financial services industry operate in an increasingly digital world. The company works with more than 1,500 global financial institutions and lenders, including Barclays, Santander and Societe Generale.

Now, as SBS supports banks’ digital transformation journey, it is evolving alongside them. The company’s shift to a SaaS-first model is part of this evolution, and mirrors the changes banks and financial institutions are going through. We sat down with Unger to discuss the change.

  1. Before entering the software space, you worked on the other side of the banking industry at institutions like Merrill Lynch, UBS Investment Bank and Falcon Private Bank. What prompted the transition to software?

I spent most of the first decade of my career focused on financial services, both as an M&A advisor and principal investor. I really enjoyed the analytical and client-facing part of the job, but soon realized that my true passion was for leadership, and specifically designing and building new operating models and driving organizational change. .

The first challenge I faced was implementing a new strategy for a private bank that, among other challenges, involved a complete re-platforming of the core banking system as well as an operating model dependent on partners. It was important to introduce. Applications This was at a time when SaaS was not as widely used a standard term as it is today. Additionally we took the opportunity to digitize many of our core processes and introduce self-service solutions for clients. Considering that we are still talking about the same things for the majority of the financial industry, it is hard to imagine that changing IT systems and creating new digital business models will take 10, and even 15 There were important priorities even years ago. But it just goes to show how long it takes for an industry to fully embrace and transition to new technologies, and ways of working. Of course, the technologies I focused on were very different from what organizations are working with today. However, the key point has always been to understand where the pain points and inefficiencies of organizations are, and then figure out how to solve them with technology.

Having spent years in a different part of banking, I was able to leverage my experience in how organizations are approaching digital transformation — including the specific services they were looking for, the implementation challenges they faced. were doing, and where were they looking. Mostly external support — to build software and service models that directly address these needs.

Moving outside of the banking space felt like a big leap at the time, but now, the gap between traditional banks and third-party technology providers has narrowed significantly and working in an ecosystem is more than ever. It is normal. At SBS, for example, we act as an extension of our clients’ internal teams as we get them up to speed with new software integration and digital tools. Although I am not directly working at a bank at this point in my career, I still feel fully involved in the financial services industry.

  1. Banks and financial institutions are now undergoing similar changes, with many looking to implement fully digital and software-based models. How do you see this trend shaping up?

As my personal career journey has seen the blending of traditional and digital financial services, I believe the organizational lines between banks, fintechs and other technology providers will continue to blur as banks move away from monolithic legacy systems and partnerships. Add standard software solutions from partners.

For example, we’ve already seen many banks move away from a fear-based approach to fintechs—which were thought to be taking market share away from banks—and instead look to Let’s start with how they can cooperate with each other. Most banks have no shortage of products, systems and operations on their digital priority list. Because of this, working with fintechs and technology companies to provide some of these pre-built offerings has become a more attractive option than building everything yourself.

In addition to the financial industry’s growing investment in digitization as a whole, the way organizations approach digitization is also evolving. With software in particular, banks and financial institutions used to host all of their digital applications on their own infrastructure, or “on-premise.” They were responsible for everything including routine updates, maintenance and data backups that can require significant time and resources—especially in large, global organizations.

Now, advances in public and private cloud offerings allow organizations to take a software-as-a-service (SaaS)-based approach to digitization. This involves a much lower operational burden on banks, allowing them to adapt new capabilities at a pace that is more in line with the rate of innovation in the software industry.

While the SaaS model is certainly no longer new in enterprise software thanks to players like Salesforce and Microsoft, it is still relatively uncommon in core banking software. I believe it is only a matter of time before it is more widely adopted in the industry.

  1. What advantages does the SaaS model offer banks over more traditional approaches to financial software?

There are an array of benefits – from reduced upfront costs, to quick updates, to the ability to scale with banks and evolve to market needs.

For example, consider a service like instant payments. Banks and financial institutions around the world are preparing their systems to adapt to new systems and regulations, such as Europe’s Single Euro Payments Area (SEPA) rules and the recent launch of the FedNow service in the US.

Routine nightly updates of on-premise software and daily batch processing prevent banks from processing these payments in real time and at all hours of the day. Digital SaaS offerings, on the other hand, can be quickly implemented on top of existing banking systems, and then scaled to keep up with the volume of instant payments transactions as adoption grows.

The cloud-based nature of SaaS systems also offers autonomous availability 24 hours a day, 365 days a year, so banks don’t have to worry about dedicating entire teams to managing their instant payment functions. Is.

These same principles of SaaS can be applied to virtually any service that a bank or financial institution wants to offer—and ultimately, spread throughout the organization.

  1. You joined Supra Banking Software at a pivotal moment in the company’s transition to a cloud and SaaS-first software model. Can you tell us more about this change, and how companies can adapt their internal operations to new market demands?

SBS is a subsidiary of SupraSteria Group, a global technology consultant that has been on the front lines of digitization for over 50 years now. This means we’ve always had first-hand insight into the digital challenges and opportunities that financial institutions face. We have and continue to evolve alongside our clients as they adopt new technology and new operating models.

Our shift to a SaaS-first model is part of this evolution, and a direct reflection of the changes that banks and financial institutions are going through. In addition to moving our entire suite of products to the cloud, we’re doing the same with our internal systems and processes. For example, we have been developing in the cloud for years and recently started using AI tools for better and faster development.

  1. How does SupraBanking plan to change its internal operations in response to this change in the software market?

To begin with, we have strengthened our partnership with AWS, the primary cloud provider for the Supra Banking Platform and the Supra Financing Platform. We recently joined the AWS ISV Accelerate program, which will enable us to scale the delivery of our cloud-based offerings not only in Europe, but also in the US and around the world.

SBS also operates in more than 15 markets worldwide, and has acquired and built a number of new software offerings over the years. Part of my role—and the continued transformation of SBS as a company—is focusing on bringing all of our capabilities into a single global model that leverages each of our individual market and product strengths. We are here to support our more than 600 clients on their individual journeys leveraging the breadth of our portfolio of software products. To that end, we are investing more than 40% of our software revenue in R&D to continue to deliver world-class products to our clients.

As we see growing demand from banks and financial institutions globally who want to approach digital transformation with the flexible, modular nature of SaaS-based products and services, we want to stay the course and deliver them. Committed to providing the solutions they need to support. They grow their top line, while simultaneously reducing their total cost of ownership (TCO), time-to-market (TTM), and reducing risk in their operations.

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