What is core banking services?

Acceleration of business processes requires prompt data processing. So financial institutions regularly introduce new information technologies.

This speeds up the processing of transactions. It ensures the execution of transactions. And it enables customers to remotely manage their accounts in real time. The entire complex of functional and technical means that ensure the operation of a bank. It’s as a single complex system. It is called an automated banking system (abbreviated as ABS). Such a complex includes technical equipment and software.. Nowadays core banking services are rather widespread.

Automated banking system – a set of software and hardware. It ensures the execution of electronic transactions and payments in an automatic mode. The opportunity to optimize not only financial. But also management processes appeared due to the active development of computer technology. There is transactional data processing. Also there are instant postings. And here is verification of transactions for correctness. There is customer support 24 hours a day. All this is possible with the active development of new IT technologies.


ABS is a complex and multifunctional complex that has a modular construction system. It implies dividing the entire system into certain categories. Each of it is responsible for specific operations. In a standard automated system, the following modular blocks are distinguished:

Back Office. This system ensures the functioning of internal settlements. It relates to payment cards, deposits, loans and cash transactions (postings). At the same level, applications for credit programs are processed.Transactions are carried out on transfers. They are  between the settlement accounts of clients (individuals, legal entities).

Front Office. This level includes hardware and technical means. They are used for primary data processing, their systematization and uniform categorization. Here, payment orders and requests are formed, documents are accepted. There are financial statements and payment documentation are drawn up.

Accounts office. This block includes several modules responsible for accounting entries. It’s custody accounting, urgent operations, balance sheet accounting of liabilities and assets. At the same level, bank statements are formed, economic indicators are analyzed. And it’s the efficiency of the financial institution is assessed.

It should be said about the information security system. The main task of it is to reduce the risks. They are associated with unauthorized attempts to steal data. And they perform fraudulent operations. To do this, the ABS uses a complex encryption system. There is multi-stage identification, a data backup system (back up). It’s antivirus software to protect against DDoS attacks and other hacking attempts.

The advantages of modularity:

  • prompt collection of primary information and their entry into a single database;
  • phased update of the entire system;
  • protection from accidental duplication of information;
  • convenient reporting to the Central Bank and the tax service;
  • high efficiency and speed of data processing.

The successful functioning of the ABS is complex task. It is possible only with the well-coordinated work of all modular components. Therefore, any bank has a department dealing with information and technical support. In conclusion, it should be noted that automated banking system is in constant improvement. It is due to the active development of digital technologies. As well as the emergence of new banking products and services.

The creation of automated banking technologies requires the peculiarities of the structure. The specifics and volumes of banking activities are numerous. This refers to the organizational interaction of all divisions of the bank. It’s done with complex information links of forward and backward directions.



TBN Editor

Time Business News Editor Team