The article summary was originally published on February 3, 2020 in American Banker by Penny Crosman.
Ryan James is done with the legacy core system providers that dominate the banking market.
Frustrations with customer service, corporate culture and pricing helped push him to switch to a newer group of providers using cloud-based core banking systems for application programming interfaces. These companies help to streamline a bank’s technology and put smaller, community banks on the same playing field as larger, national banks.
“The biggest threat to banking innovation is the legacy cores,” said James, who is CEO of Surety Bank in DeLand, Fla., which has $130 million in assets. “I want the bank to be here for another hundred years, and it just was not happening under any legacy core.”
“When I was under legacy core, I got lied to time and time again,” said James, who did not not single out any but said he has dealt with them all. “They would say, ‘We’ve got this product.’ And then you get it and launch it and it doesn’t have half the things that you thought it had. And they’re like, ‘Oh, that’s an add-on.’ They just don’t follow through. And then when you do need a best of breed — they can’t be the best at everything — they make it so difficult to plug and play.”
“They want to charge you for every tiny little thing, even though they may not have a direct cost,” James said. For instance, some new accounts have low balances for a long time before they start to grow. But the large core providers tend to charge $7 per account per month for mobile and traditional banking no matter what.
“They don’t care about whether their bankers are viable,” James said. “And they make it difficult when you leave” with rough core conversions and termination fees.
“They had deep pockets, and they already had hundreds of millions of dollars invested in core,” he said.
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