The traditional ‘big bang’ approach to replacing a bank’s core systems is becoming obsolete, with 2025 marking a decisive shift towards pragmatic, phased modernisation strategies driven by collaboration, data, and artificial intelligence.
Software provider Finastra champions this modular path, viewing it as a necessary evolution for institutions seeking change without excessive risk or disruption. Siobhan Byron, executive vice president of universal banking at Finastra, explained that the strategic focus is on “helping our customers to reimagine banking” through a phased or modular approach. This involves enhancing traditional models by embracing curated fintech ecosystems, data, and AI to augment the core.
This trend towards collaboration over proprietary development was underscored by a significant investment in late 2025. Barclays secured a strategic stake in United Fintech, becoming the fifth global bank investor in the industry-neutral fintech ecosystem. The investment followed a year of growth for United Fintech, which completed two acquisitions and expanded its global footprint, aiming to streamline technology adoption for financial institutions. Ryan Hayward, Head of Strategic Investments at Barclays, stated that the partnership will “accelerate digital transformation across the industry,” aligning with their vision for future-ready financial services.
Christian Frahm, CEO and Founder of United Fintech, emphasised the growing necessity for partnership, adding, “With AI accelerating across financial services, industry-wide collaboration has never been more important”.
Looking ahead to 2026, the embedding of AI is poised to become the single most defining trend in financial services. The industry’s sharp focus on intelligent systems is reflected in the creation of new, dedicated awards for the coming year. David Gyori, CEO of Banking Reports, anticipates that 2026 will be an extremely important year for the “strategization of AI within banking,” which he expects to be visible in industry submissions.
Banks are increasingly under pressure to keep pace with customer expectations, demanding seamless, frictionless, and personalised digital experiences. This is driving institutions to leverage technology and embrace fintechs that have already figured out ways to enhance processes. Automation, such as chatbots, is also playing a key role in providing 24/7 access to support and services.
Cloud adoption, while still uneven globally, is also set to accelerate. Byron noted that the ability to offer flexible deployment—on-prem, private, or public cloud—is essential to provide banks with the optionality they need for migration. The ultimate goal for institutions is to leverage the tech and innovation found in the wider fintech ecosystem to remain competitive and manage the inherent risk of large-scale change.