These may access old data and enable instant transactions. Financial executives state that banks must enhance their fundamental bank...
These may access old data and enable instant transactions.
Financial executives state that banks must enhance their fundamental banking technology and utilize artificial intelligence (AI) to access old data and support instant transactions.
"Typically, banks invest years and significant resources in developing data platforms and organizing data - this method is too slow for the current environment. We require a new way of thinking, beginning with the specific application, rather than the technology," statedAkio Isowa, senior managing executive officer and group chief digital innovation officer ofSumitomo Mitsui Banking Corporation (SMBC).
Representatives from Tencent, Thought Machine, Perflos, and the International Monetary Fund (IMF) at the Festival Stage ofSingapore Fintech Festival 2025(SFF 2025) reflected on the development of fundamental banking technology, and highlighted the significance of ethical AI in regulatory adherence, fraud detection, and instant transactions.
Currently, quicker methods to access existing data for AI applications involve techniques such as MCP, agent-to-agent protocols, or comparable systems to connect legacy infrastructure with modern AI-based solutions, Isowa mentioned during the "Building an Intelligent Stack" session at SFF 2025 on November 13.
"The objective is straightforward: use AI to transform old data into improved business results," he stated.
Tencent's AI-powered solution enables merchants to scan and convert their menus into digital formats, enhancing operational efficiency, while Thought Machine's cloud-based core banking system, adopted by 60 banks, focused on scalability and automation.
Upon scanning a food vendor's QR code, a menu will be displayed on their mobile device, allowing them to place an order and pay the correct amount.Forest Lin, corporate vice president and head of financial technology ofTencent, informed the session moderatorSopnendu Mohanty, Group Chief Executive Officer of the Global Finance & Technology Network (GFTN).
Dr. Paul Taylor, founder and CEO of Thought Machine, stated that the company developed an API-focused core banking system because banks lacked APIs in their mainframes, resulting in a shortage of real-time data.
However, in the past decade, financial institutions have transferred significant portions of their operations to cloud-based systems.
Perfios transitioned from a digitization tool to a comprehensive platform, statedSabyasachi Goswami, CEO of Perfios. It collects and enhances data to offer a platform for financial services, he mentioned.
Shirin Hamid, chief information officer and head of the information technology department at the International Monetary Fund (IMF), highlighted that the technology implemented by central banks needs to be robust.
The panel members explored the significance of artificial intelligence in areas such as compliance, preventing fraudulent activities, and facilitating instant payments, along with the implementation of ethical AI practices within industries that are subject to regulation.
Here are excerpts from the panel discussion:
Mohanty: Consider the changes that have occurred in the realm of core banking, the technology framework.
Isowa: Discussing the transformation of core banking involves more than just technology; it begins with reevaluating the structure of the organization. Historically, banks have invested significant time and resources in developing data platforms and organizing data, but this approach is too sluggish for the current environment. We require a new perspective, focusing on the use case rather than the technology.
Consider intelligent and efficient methods to access existing data for AI purposes, such as employing techniques like MCP or agent-to-agent protocols, or other comparable systems to connect outdated infrastructure with modern AI-based solutions. The objective is straightforward: utilize AI to transform legacy data into improved business results.
Previously, banks typically handled architecture design and development according to organizational structures, with certain applications on the front end and others in the middle office, resulting in silos across the board, including those involving AI and Agent AI. This approach might no longer be effective. We may need to rethink how teams are structured, trained, and supported, enabling them to better serve customers in this new environment, which reflects the true essence of reimagining the core.
MohantyWhat steps have you taken to address fundamental technology, infrastructure, and efficiency in the financial services sector?
LinEvery day, we are seeking out use cases that can be enhanced to make our users' lives better. For instance, recently, we introduced a feature that I really enjoy, which is particularly beneficial for Weixin Pay merchants such as breakfast shops, bakeries, or noodle stalls. One of their main challenges is that when a customer orders a dish, it takes a significant amount of time to identify what the customer has ordered and to correctly match it with the corresponding payment amount.
Recently, we introduced an AI-powered tool. When users scan the QR code, the menu appears directly on their mobile phones. They can then click on the menu to order food and pay the correct amount. This saves merchants a significant amount of time.
Mohanty: Consider how Thought Machine enhanced fundamental banking over the past decade.
TaylorInitially, we focused on the issue of legacy systems, mainframes, and banks. It's quite astonishing. If you look at other industries around the world, none would begin by using mainframes or this kind of technology, but banks have been using it for a long time. They are trapped in this technology. There is no real-time data streaming, no up-to-the-minute information. There are isolated data silos and repeated data entries.
We developed a brand-new core banking system entirely from the ground up in the cloud, with everything being API-based. However, as you might know, banks have shifted a significant amount of their operations to the cloud over the past decade, and we have achieved considerable success. We now have more than 60 banks signed up in Singapore.
MohantyThink about how you have utilized technology to reach your current position.
Goswami: We developed a platform capable of interpreting all types of data, whether structured or unstructured. We utilized this capability to offer a platform to the entire banking and financial services sector. Over the past decade, it significantly transformed how financial services infrastructure was perceived. Initially, it was seen more as a tool for digitization.
Now, it has developed into an ecosystem where discussions around open banking and cooperation are constant. This evolution began with a small step in automation, the transition to digital processes, which represents the complete end-to-end procedure.
HamidOur member nations, which we concentrate on, are central banks, and therefore we aim to make sure that you understand, that central banks are not overlooked. However, at the same time, I believe, with the fund, we want to ensure that we are also evolving with a technology framework that is up-to-date.
Over the past 10 years, I can confirm that whether it's the IMF or during my time with multilateral organizations, the focus has been on ensuring the technology stack remains relevant. Here, we are discussing the cloud and adopting cloud solutions.
We also discuss what I refer to as hygiene capabilities, the existing enterprise architecture, ensuring that you have proper quality assurance, and moving toward and adapting an Agile approach.
We also discuss making sure we have the ability to move security left in our processes, adopt a secure-by-design approach, and address all aspects right now, considering the current geopolitical situation. Cybersecurity has become a top priority for any product or platform we develop, and even our operating model needs to be up-to-date.
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