7 September 2021

Oracle: The Right Architecture for Next-Generation Banking

Sonny Singh
Oracle Financial Services
5 min
Sonny Singh shares how Oracle’s agile, deeply-invested banking architecture has been designed for success in a FinTech innovation-fueled landscape

Oracle offers an integrated suite of applications, plus secure, autonomous infrastructure in the Oracle Cloud. Oracle Financial Services, the fintech business of Oracle, enables financial companies to deliver better services. Oracle defines these services as being truly centred around the customer, digitised in their entirety, intelligent in process, and resilient as a growth enabler. Powered by cloud infrastructure and technology innovation, its financial services portfolio is built with deep domain expertise and a best-of-breed acquisition strategy. 

Today, Oracle’s solutions blend decades-long knowledge of banking with consistent product innovation and investment to make it the industry-leading platform for banks. It offers a mix of deep functionality, coupled with modern architecture and model choice deployment—giving financial institutions the best options based on their operating models and business strategy.

The foundation of next-generation banking success begins with the architecture and technology decisions made today

Customer demographics, demands and shifting technology paradigms will decide the shape of next-generation banking. Digital natives and adopters now demand banking embedded in their lives with seamlessly connected actions, advice, and support that is personalised to them and based on their life moments.

As a result, banks will need to reinvent themselves at a breakneck pace to retain and win new customers. There will always be fintech innovators offering a better customer journey, leveraging the latest data-driven capabilities that can take customers off the market. Therefore, banks must be inherently agile, open, and architecturally flexible. According to Oracle, this is the only option. 

To help banks adapt, Sonny states, ‘Oracle's banking architecture is developed to provide banks with the power to determine their success path in a rapidly changing landscape, based on their customer demands. Our strategy has been to provide a functionally rich and componentised product suite that helps banks drive a progressive transformation and continuous innovation strategy with built-in innovation. Our customers can focus on outcomes and not waste time experimenting with new tech and architectures, and we give them a complete choice on deployment. This sets them up for the next generation of banking’. 

Quotables
Quote
Prepare for change, expect continuous disruption and build for instability
Author name
Sonny Singh
Job Title, Company
Executive Vice President & GM of Oracle Financial Services
Quotables
Quote
Oracle is continuously investing to create the most modern digital, data and core platforms in the financial technology space
Author name
Sonny Singh
Job Title, Company
Executive Vice President & GM of Oracle Financial Services
Quotables
Quote
Banking should be invisible and embedded within the customer’s life
Author name
Sonny Singh
Job Title, Company
Executive Vice President & GM of Oracle Financial Services

Overall, Oracle Financial Services takes an architectural-first approach to provide a blueprint for banks to continuously adapt to the shifting shape of banking. To do so, it gives customers a complete choice of deployment that will set them up for the next generation. 

A perfect blend of functionality and flexibility 

It’s time to think differently as the rules of banking are being redefined. Finding new revenue models, accelerating roadmaps to digitalise experiences, managing risk and regulation while delivering more with less is the new mandate. Market-leading banks will need to rapidly adjust to these new conditions, and as we mature into an ecosystem of embedded banking, survival will be based on the ability of banks to rapidly adapt their products and services to new channels and open ecosystems.  

For example, younger customers are interested in payment methods other than traditional credit and lending. Oracle’s 2020-2021 Global Retail Banking Consumer Trends Survey & Report found that 20% of banked customers aged 30 and below are very likely to use an alternative method for all payments in the next 12 months. Exploring customised lending options and participating in market collaborations to offer revenue value-adds like POS financing or specialised consumer lending options creates a new revenue stream and customer acquisition path. In this type of ecosystem, banks with limited functionality will lose market share to their competitors. 

Therefore, to succeed in the next generation, banks will need to deliver quality yet agile services that provide a differentiated experience. As such, Oracle’s banking portfolio is built with the richest functionality. This creates a domain-driven design approach that spans retail banking, corporate banking, and business lines from financial inclusion to Islamic banking. 

Open and interoperable right from the start 

Oracle’s product engineering prowess ensures that its banking solutions are open. With 3000+ exposed microservices and open APIs across its platforms, its systems are designed to be interoperable, secure, and seamless across systems, gateways, and regulatory interfaces. Oracle Financial Services is also an early adopter of standards, making its services easy to consume and connected right from the start. 

Programmed for continuous innovation 

Oracle Financial Services leverages enterprise innovation to quickly deploy early-market and industry-leading technologies, like cloud services, to stay ahead of disruption, bringing benefit to each of the customers regardless of size or geography. For example, banks have quickly deployed use cases—such as approvals on wearables, peer-to-peer payments, voice-assisted transactions, chatbot-based self-originations, and micro-transactions via Quick Response (QR) codes. 

The company is embedding artificial intelligence capabilities and automation processes into its systems to help banks track customer behaviour and preferences. The more banks know, the better they can adapt to consumer demands and thrive in an ever-changing financial landscape. 

Oracle’s technology paradigm of continuous innovation and continuous delivery supports this philosophy—and DevOps plays an important role in its iterative, agile design. All of its applications work together to pave the way for the effective digital bank of the future. 

Microservices for the real world, not a buzzword

Oracle Financial Services takes a foundational approach to microservices by building out new capabilities on a cutting-edge chassis that creates resiliency, scalability, and flexibility across the institution’s operations.  Microservices allow banks to realise the benefits of modern architecture and create a protected, scalable environment to deploy new capabilities quickly, bringing continuous innovation to the marketplace. This provides responsiveness and predictable experiences to customers and bankers and helps them leverage AI/ML for workflow automation.  

As the banking ecosystem evolves, microservices and a component-based architecture will help banks weather the unknown and transition away from monolithic and legacy environments. 

Cloud as the essential element of adaptability 

Cloud will be the default infrastructure option for market-leading banks. Running on Oracle’s cloud infrastructure, Oracle Financial Services offers its solutions on a cloud-ready model, with an increasing suite of cloud-native applications. Based on preferred business models, banking customers can choose better methods of deployment. As Oracle sees it, to compete in next-generation services, banks must adapt to a continuous shapeshift. And to achieve lasting success, they’ll need the right architecture and technology—Oracle’s speciality. 

 

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