Why Banks Love Mainframes

by Tim Sloane 0

This Network World article lists several reasons why banks love mainframes, but the capabilities that the article presents can all be derived utilizing cloud containerized systems as long as the software was properly written for the cloud environment. While mainframes do deliver robust, reliable, and rapid processing power, it is a far cry from “every bank:”

“Every bank uses a mainframe because only big iron provides the processing power to support the many functions banks need a computer to perform. Mainframes don’t just keep the bank’s records and crunch numbers. They support cloud and mobile transactions, monitor for signs of fraud, perform analytics in real time, and more—and all simultaneously. Banks love mainframes because only mainframes can provide for a bank’s every need without breaking a proverbial sweat: a single, unified, efficient solution to a host of different problems.

Mainframes have been around for more than 50 years, and though they predate mobile technology, they are perfect for supporting both mobile and cloud-based banking. When the banks first installed big iron, you had to physically walk into a branch to withdraw or deposit money.

Mainframes alone have the sort of robust, reliable, and rapid processing power financial institutions need to do all major computing functions all in one place.

Today, everything is different. Banks rely more and more on mobile and cloud-based interactions. People check their balance, make purchases and transfers, and deposit their checks online using their mobile devices and cloud technology.

For larger banks, this can mean thousands of transactions per second, uploaded remotely via mobile to the cloud to be processed and filed away by a mainframe. Without all that processing power, banks simply would not be able to reliably handle the volume of information they receive.”

Core banking systems integrate to a wide range of support systems and have received an extraordinary number of software upgrades implemented to address a wide range of business and regulatory needs and they operate in a highly regulated environment. These issues make it incredibly difficult to replace a mainframe, especially if considering a new cloud-based business model, so mainframes will continue to operate many large financial institutions well into the future.

Overview by Tim Sloane, VP, Payments Innovation Advisory Service at Mercator Advisory Group

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