Core Banking Software Market Worth USD 60.26 Billion by 2033 | CAGR of 14.70%

Introduction

Banking firms utilize core banking software to keep the flow of banking activities, including post updates to user accounts, payments, transactions, and other financial records. It provides users with real-time online centralized banking services. Various banks are deploying CBS to help their customers with bank-related tasks, including money transactions, loan processes, debts, and account access. Core banking solutions assist banks in lowering operating and support costs, providing real-time transaction processing, and managing bank accounts across several locations. As a result, this has become the market's most crucial growth element.

Market Dynamics

Rising Adoption of Cloud-Based Solutions and Managing Customer Accounts from Single Server to Drive the Market

One of the major market drivers is the growing use of cloud-based or SaaS-based banking systems provided by software professionals such as Temenos AG, FIS worldwide, and Finastra. Cloud-based solutions can help banks keep track of payments, transactions, and other banking activities. As a result, as the demand for efficiency and innovation in businesses develops, so will the market. Key firms also stress introducing additional features to gain a competitive advantage.

As a result, various banks' increased adoption of cloud-based banking platforms will likely drive core banking software market demand in the coming years. Increasing usage of remote banking, cybersecurity, Payment as a Service (PaaS), and Big Data technologies is also expected to drive market expansion throughout the forecast period.

The high need for successfully managing client banking accounts from a unified platform is expected to drive market expansion during the forecast period. Core banking solutions offer bank staff accurate account information through an end-to-end platform. This platform includes rapid reporting, enterprise content management, deposit accounts, credit analysis, customer onboarding, customer relationship management (CRM), account opening, loan origination, workflow, and deposit accounts. Furthermore, core banking solutions integrate the bank's transactional and core systems, removing the need for manual processes and point solutions.

Banks worldwide are attempting to integrate AI into their core banking systems to extract meaningful consumer data in real time. These tools assist banks in increasing operational efficiency, analyzing transactions, detecting fraudulent activity, reducing risks, and understanding consumer behavior. Due to their improved ability to examine complex data sets, banks can make more educated decisions regarding their banking services, products, and operations.

Focus Towards Advanced Banking Systems to Create Growth Opportunities

The outbreak of COVID-19 has had a significant impact on workplace culture. As a result of the circumstances, many banks and other financial firms have been forced to allow their employees to work from home (WFH). The financial sector is dealing with quick interest rate swings and delayed lease payments, which have resulted in a massive reorganization of the global financial system.

Due to the pandemic, many banks and other financial institutions find it challenging to restore changes in the overall loan and credit management environment. Key industry participants focus on delivering innovative software solutions to overcome such barriers.

For instance, Temenos AG unveiled their sophisticated SaaS-based eight ideas in April 2020, leveraging advanced cloud technologies and Explainable Al (XAI) to assist various institutions in promptly responding to the COVID-19 pandemic. Such proactive measures are expected to promote CBS demand, helping the industry thrive.

Regional Insights

North America, Europe, Asia-Pacific, South America, the Middle East and Africa make up the market's five regions. Asia-Pacific and North America are the two most important markets for core banking software. The Asia-Pacific market is anticipated to grow because of the growing adoption of mobile and web-based business applications in the banking industry. Several banks in the region are also working on core banking systems, which will allow them to handle enormous quantities of transactions and banking services without interruption.

North America is expected to be the second-largest core banking software market, with an expected market value of USD 4,861 million by 2030; as major banks use modern core banking software on a large scale, the regional market is expected to grow. Furthermore, these solutions are used by small and medium firms in the region to maintain a seamless flow of funds.

The European market will likely grow because of the many-core banking software vendors in Europe. The Middle East and Africa region are expected to grow dramatically during the forecast period. Increased fintech investments by governments will drive the Middle East and Africa market to implement modern technologies such as cloud-based solutions, big data, blockchain, artificial intelligence, and 5G network.

Since banks are increasingly adopting digital banking solutions, the market in South America is expected to rise steadily. For example, Rabobank in Brazil cooperated with Oracle Corporation to update digital payment services in February 2021.

Key Highlights

• The global core banking software market size was valued at USD 17.54 billion in 2024 and is projected to reach from USD 20.12 billion in 2025 to USD 60.26 billion by 2033, growing at a CAGR of 14.70% during the forecast period (2025-2033).

• By solution, the enterprise customer solution segment is expected to reach USD 5,767 million at a CAGR of 6.85% by 2033.
• By service, the professional service management segment is expected to reach USD 5,662 million at a CAGR of 8.25% by 2033.
• By deployment, the on-premise deployment segment is expected to reach USD 3,605 million at a CAGR of 4.25% by 2033.
• By end-user, the banks’ end-user segment is expected to reach USD 11,817 at a CAGR of 8.25% million by 2033.
• The global core banking software market is geographically divided into North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa. Asia-Pacific and North America were the two significant regional markets.

Competitive Players

1. Finastra
2. Capgemini
3. Fiserv Inc
4. Infosys
5. SAP
6. Temenos AG
7. FIS
8. HCL Technologies Limited
9. Oracle Corporation
10. Jack Henry Associates Inc.

Recent Developments

Recent Developments

• September 2021- SAP SE announced the establishment of "Fioneer," a financial services industry joint venture between Dediq GmbH and SAP SE. SAP Fioneer is a financial services software add-on from SAP. In the ever-changing banking and insurance industries, it offers new solutions to help its customers.
• August 2021- As part of the Oracle Banking suite, W1TTY integrates Oracle FLEXCUBE, Oracle Banking APIs, and Banking Payments. Real-time payments, digital experience, and retail and business banking applications are all part of the package.
• October 2020- Finastra launched Fusion Payments to Go, a pre-packaged payment solution, to help small and medium-sized banks in the United States, Europe, and South Africa operate domestic and cross-border payment services. This system provides superior functionality and rules to support clearing and settlement procedures, improve client experience, and achieve revenue growth.

Segmentation

1. By Solution
   1. Deposits
   2. Loans
   3. Enterprise Customer Solutions
   4. Others
2. By Service
   1. Professional Service
   2. Managed Service
3. By Deployment
   1. Cloud
   2. On-Premise
   3. SaaS/Hosted
   4. Licensed
4. By Bank Type
   1. Large Banks
   2. Midsize Bank
   3. Small Banks
   4. Community Banks
   5. Credit Unions
   6. Others
5. By End-User
   1. Financial Institutions
   2. Retail Banking
   3. Treasury
   4. Corporate Banking
   5. Wealth Management
   6. Others