Financial Services Firms Adopt Agility Layers to Modernize Core Systems

What's Happening?

Financial services firms are increasingly adopting agility layers to modernize their core systems without undergoing a full replacement. These layers serve as flexible frameworks that connect legacy systems with modern applications, facilitating innovation and reducing operational risks. The agility layer includes a data fabric that unifies data from separate systems, eliminating manual data gathering and reducing errors. This approach allows firms to innovate new products and services rapidly, meeting rising customer expectations and regulatory demands. The strategy is seen as a solution to the modernization dilemma faced by firms whose outdated core IT systems hinder collaboration and compliance.

Why It's Important?

The adoption of agility layers is significant for the financial services industry as it addresses the challenges posed by legacy systems that are costly to maintain and difficult to integrate with newer technologies. By implementing these layers, firms can enhance their operational efficiency, reduce risks, and improve customer experiences. This approach also supports compliance and regulatory requirements by providing secure access to unified data models. As firms navigate the complexities of modernization, agility layers offer a path to sustainable transformation, enabling them to remain competitive in a rapidly evolving market.

What's Next?

Financial services firms are expected to continue exploring incremental modernization strategies, focusing on high-impact areas such as payments, lending, and onboarding. By targeting specific workflows, firms can achieve rapid returns on investment while laying the groundwork for broader transformation. The use of process mining tools to identify inefficiencies and opportunities for improvement will likely become more prevalent, helping firms unlock efficiencies and accelerate innovation.

Beyond the Headlines

The shift towards agility layers may lead to long-term changes in how financial services firms approach technology integration and innovation. As firms become more adept at connecting legacy systems with modern applications, they may experience cultural shifts towards more agile and collaborative work environments. Additionally, the emphasis on data unification and AI-powered automation could drive advancements in customer service and compliance, setting new industry standards.