Banking technology is one of the biggest investments keeping your institution in business. And, when we talk about technology, we’re referring to more than just the core. Technology is the entire infrastructure powering the front and back-office operations, from something as small as the bank’s email platform to the servers and data centers housing all of the bank’s customer data. Whether it’s software, hardware, or the cloud, we are highly dependent on technology to work when we need it.
The problem is many banks hold on to old, underperforming technology, believing it may be easier to operate and cheaper to perform patchwork than update or upgrade an entire system. Even worse is when banks don’t have the right experts in place that can provide the guidance needed to avoid risk and support to get the bank to a higher-performing state. Learn what it costs when your bank doesn’t have the right technology expert by its side.
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The Wrong Person for the Job
If your bank has one of the following people or entities in charge of your IT, chances are you’re not seeing the performance that you should, and your bank could be at risk.
- Third-party IT companies – Community banks often partner with third-party IT companies to manage their networking, system installations and updates, and even their website hosting and maintenance. Many of these IT companies are not exclusive to the banking industry, so they may not be aware of all the compliance requirements that a financial institution needs to fulfill. This can increase your compliance burden and possibly lead to issues with regulators.
- Internal bank staff – To save on costs, a bank employee may often take on the IT role internally and wear multiple hats when trying to manage bank operations as well as IT services. However, many banks that bring IT in-house don’t realize the crucial responsibilities needed to fulfill the role. Modern IT complexity and the speed of technology, along with new digital products, and increased cybersecurity threats make it critical for anyone in IT to stay current on trends, regulation changes, and compliance. Often temporary fixes and patches are applied, which only create a pressure valve of stacking issues. For the bank to avoid disruptions to service, an experienced IT professional must proactively monitor system performance and conduct routine maintenance. Avoiding doing so can cause more issues and require the bank to spend more time and resources diagnosing and repairing problems later on, costing you even more than what it would have to hire an expert from the beginning.
The Costs of Managing IT Without the Proper Expertise
Time and money are the assumed costs for enlisting IT services. But did you know there are also indirect costs when your technology falls into the wrong, inexperienced hands? All of the following outcomes affect a bank’s success in the long-term.
- Limited growth and revenue opportunities – When your bank is not performing optimally with the tools and technology it has in place, it impacts your bank’s ability to grow. For example, if your bank does not have a secure email provider, it may have to rely on mailing documentation or asking customers to come into the branch for a signature. Either of these options cause delays in receipt and processing, and at times frustration for the customer. Sending a secure email expedites the process, reduces paper storage and waste, and keeps your customers happy. Work with a vendor that offers solutions for both customer acquisition and retention, so you can continue growing your bank regardless of the climate.
- Impact on customer retention - Has your bank ever experienced downtime or a service disruption? When this happens, not only does your bank harm its reputation, but it also loses the trust of your customers, which puts a hole in your pocket for existing and future business. Think of major legacy vendors whose servers went down in 2019, leaving customers without access until systems rebooted. It happens frequently in the industry, but doesn’t have to. Work with a vendor that keeps your system current and updated at all times and valid business continuity plan in place with fail safe procedures in the event a natural disaster or cyber incident.
- Increased compliance risk – Whether it’s working in a lagging system or with an IT vendor that is not experienced in banking, your bank has a significant risk for compliance violations. A vendor that doesn’t regularly monitor and update your technology can leave your bank vulnerable to cyberattacks, data loss, and even system shutdowns. Suffering from a data breach or cyberattack can paralyze your operation and open you up to heavy violations and fines.
- Expended management time - When IT problems become a regular occurrence or contribute to operational breakdowns, your management team must use valuable time to address the issues. If you’re constantly fighting IT fires, it is hard to be strategic. Even day-to-day management can be stressed by minor outages. Finding a partner that can manage your technology allows you to do what you do best and focus on results.
Work With a Real Banking Technology Expert to Manage IT
To have a competitive advantage in the industry and to better maintain compliance across technology platforms, a community bank must work with an IT vendor that has vast experience and knowledge in technology and banking. You can have a glamourous technology suite, but if it isn’t secure or performing correctly, then what’s the point?
At IBT Apps, we recognize that bankers need a complete technology solution that offers secure support to their entire infrastructure (not just the core) and a service that upholds the highest compliance standards. That’s why we offer Managed and Hosted Network Services to community banks nationwide and take away the headaches of having to manage and run your own IT.
Clients sleep better at night knowing that IBT Apps MNS team takes care of the following:
- End-to-end security – Every facet of MNS is designed for the security and protection of a bank’s data, network, and systems. IBT Apps and the MNS service are regulated by the FFIEC, OCC, FRB, FDIC, and State, ensuring a higher level of compliance.
- Examination support – Proactive compliance is no longer out of reach for banks. IBT Apps’ MNS team can provide you with the technology and process support that your bank needs during a security examination, which can include customized reporting and documented industry specific and required cybersecurity processes and procedures. IBT Apps also uses learnings and findings from client exams and auditor requests to continue improving this service and creating value for its clients.
- Total systems management – Banks can eliminate the need for multiple vendors. With IBT Apps complete solutions model, community banks can have their core and digital banking platforms as well as Managed Network Services under one umbrella and one partner.
- Ongoing maintenance – IBT Apps takes care of all system maintenance, patching, updates, security and vulnerability scanning and remediation, as well as 24x7x365 real-time alerting and monitoring. With a trusted banking technology partner like IBT Apps and a reliable, secure, and compliant infrastructure in place, you can focus on running your business instead of running your IT department.
Avoid lying awake at night wondering if your bank’s technology will live to see another day. Visit our official Managed Network Services page for more details and connect with us to discuss your needs.
Evaluate Your IT Provider With Our New Tool!
We laid out the above questions in an online evaluation. If you're interested in seeing how your IT manager/provider measure up, take the Community Bank IT Management Evaluation. It takes less than 5 minutes and you receive a score automatically and recommendations via email.
