CORE COMPUTING: Oracle announces new platform it calls 'transformational'

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CORE COMPUTING: Oracle announces new platform it calls 'transformational'

By John Ginovsky

After three years in development, Oracle announced the availability of its Oracle Banking Platform, a comprehensive suite of business applications for large global banks.

Tech Topics talked with its leading developer, Ashwin Goyal, group vice president for Oracle Financial Services, about why the huge hardware and software provider decided to enter the financial services core processing arena, when it already has one core product.

First, some details about the new product, per the company's announcement:

Oracle Banking Platform is designed to help banks transform their business models and processes, driving productivity improvements across both front and back offices, and reducing operating costs.

Oracle Banking Platform is designed as a native service-oriented architecture platform that ties in with banks' existing applications and technology.

Through pre-integrated applications and the underlying Oracle technology, the platform can also help to reduce in-house integration and testing efforts, ultimately, reducing IT costs and improving time-to-market.

The first release of Oracle Banking Platform includes core banking deposit and loan capabilities, as well as origination and collection for personal banking. Oracle plans to continue to build out further functionality for future releases.

Oracle Banking Platform complements Oracle's FLEXCUBE core banking product, which will continue to be sold to banks seeking a fully integrated banking solution, addressing the need for universal, commercial banking, and international operations.

We asked Ashwin Goyal why Oracle decided to develop a second core product. Here is his response:

"Three reasons. First, we saw a market opportunity, with large banks wanting to transform their domestic, or whole-market operations. The reason is very simple. The banking world today is very different than it has been in the last 30 years. Back then the bank said, "Here are the five products that we well sell you. Here's the channel we have, which is the branch. We'll have you walk in from 9 to 3. And that's it." It has gone from the bank being in charge of the relationship to the customer now being in charge of the relationship. The customer says, "I want to be able to bank anywhere, any time. I want a choice in the kind of products I have. I want a lot more self-driven relationships.

"The opportunity we sensed was that the banks are very constrained, and really not able to move to this new paradigm simply because the legacy systems, particularly those of huge banks, are so complex that the ability to be flexible and agile and to be able to do things in a way that provides something that customers want is very, very difficult to achieve.

"The second driver for the change was, as we discussed this with people at large banks, they were not looking for an all-at-once solution, where everything is changed at the same time. The amount of risk that puts on a bank, is too significant. Most of the products in the market are set up for that, we think, rather than offering a progressive transformation where they are able to balance the risk and speed while getting the benefits.

"We were able to put together a business architecture that is highly componentized, built from the ground up, which enables this progressive transformation.

"The third driver was, by launching into these industry-specific businesses, Oracle was looking to elevate its relationship with its customers. When you're just selling technology, particularly middleware and databases and hardware, the highest we'd be able to get in a banking organization would be the CIO. But when you launch a core transformation initiative for a large bank, really, you're talking to the CEO and the board of directors. They need to know that we are not just providing technology in a two-year, one-off relationship. It's a ten- to fifteen-year relationship. They know that we are a here-to-stay partner.

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