Banks choose to build their own tech solutions

While banks are investing in technology solutions to meet increasing demands, a new study shows that 61 percent prefer to build their own technology stack, rather than buy technology solutions from a third party.

The study from IT services company NTT DATA surveyed 900 senior banking respondents across 12 countries and examines the state of corporate banking following the COVID-19 pandemic.

While the majority of banks are electing to build their own solutions to meet client demands, only 22 percent are building these solutions from scratch whilst 78 percent are building on their current cash forecasting solution. For those electing to buy tech solutions, 54 percent are planning to work with fintech or a third-party provider, whilst 46 percent are integrating an off-the-shelf solution.

In Europe, the preferred option is for banks to build their own technology solutions for advanced cash forecasting, matching global trends, while over a third are looking to fintech providers to support their technology offerings. However, in Latin America the study shows there is more willingness to trust external providers, with almost half (48 percent) of banks preferring to buy in a cash forecasting solution.

"There's a tech stack demand that's building for banks, and change is being demanded by their clients. The conundrum is whether banks build their own tech, or buy it in," says Miguel Mas Palacios, director of global corporate banking at NTT DATA. "We're seeing the speed of corporate banking is accelerating, and the pace of technology change is increasing too. Banks are investing in new technologies such as AI and automation, all driven by customer demand."

The full report is available on NTT DATA's site.

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