Business Case
Executive Summary
Objective: The objective of the project is to replace Test Bank's 40-year-old core banking system programmed in COBOL with the latest Temenos Transact core banking software, the R24 release. Additionally, the project aims to integrate third-party software systems, such as Paymentus for payments and LendingPad for loan origination, while ensuring a seamless transition for the bank's 250,000 members.
Expected Outcome: The expected outcome of the project includes a modernized core banking system, improved operational efficiencies, enhanced customer experience, and compliance with industry standards. The project must be completed within six months to go live on New Year's Eve, 2024, without disrupting current members.
Problem Statement
Current Challenges:
- The existing core banking system is 40 years old and programmed in COBOL, making it difficult to maintain and upgrade.
- The current system lacks modern functionalities and is not integrated with contemporary third-party software solutions.
- There is a need to purge and close accounts with $100 or less, followed by issuing refunds by check.
- The UX design is outdated and does not meet current user expectations.
Need for Core Banking System Replacement:
- To enhance operational efficiency and reduce maintenance costs.
- To integrate with modern third-party software systems for payments and loan origination.
- To improve customer experience with a modern and user-friendly interface.
- To ensure scalability and flexibility for future growth and compliance with regulations.
Solution Overview
What is the Test Bank Core Banking Software Replacement:
The project involves replacing the outdated COBOL-based core banking system with the latest Temenos Transact core banking software, the R24 release. It includes integrating Paymentus for payments and LendingPad for loan origination, purging low-balance accounts, and automating testing with Selenium.
Types of Core Banking System Replacement:
- Full System Replacement: Replacing the entire legacy system with a new core banking solution.
- Modular Replacement: Implementing specific modules of the core banking system in phases.
Benefits of Core Banking System Replacement
- Operational Efficiency: Improved performance and reduced maintenance efforts with modern software.
- Customer Experience: Enhanced user experience with a modern interface using different shades of blue.
- Integration: Seamless integration with third-party systems like Paymentus and LendingPad.
- Regulatory Compliance: Ensures the system meets current regulatory standards.
- Scalability: Provides flexibility and scalability for future growth and innovations.
Implementation Plan
Phase 1:
- Project Initiation and Planning
- Requirements Gathering and Analysis
- System Design and Architecture
Phase 2:
- Development and Customization of Temenos Transact
- Integration with Paymentus and LendingPad
- Automated Testing Setup using Selenium
Phase 3:
- Data Migration and Account Purge
- User Acceptance Testing (UAT)
- Staff Training and Documentation
Phase 4:
- Go-Live Preparation
- Final System Testing and Validation
- Deployment and Go-Live on New Year's Eve, 2024
Cost Analysis
Initial Costs:
- Software Licenses and Subscriptions
- Development and Integration Costs
- Testing and Quality Assurance
Operational Costs:
- Ongoing Maintenance and Support
- Staff Training and Development
- System Upgrades and Enhancements
ROI Estimation:
- Increased Operational Efficiency
- Reduced Maintenance Costs
- Improved Customer Retention and Satisfaction
Risk Assessment
Technical Risks:
- Data Migration Challenges
- Integration Issues with Third-Party Systems
- Potential System Downtime during Transition
Mitigation Strategies:
- Comprehensive Data Migration Plan
- Thorough Testing and Validation of Integrations
- Contingency Plans and Backup Systems
Alternatives Considered
- Retaining the Existing System: Continuing with the COBOL-based system, with periodic updates and maintenance.
- Using Temenos Payments Hub (TPH) and Temenos LOS: Implementing the full suite of Temenos solutions instead of third-party integrations.
Conclusion and Recommendations
Recommendation:
Proceed with the replacement of the core banking system using Temenos Transact R24, integrated with Paymentus and LendingPad, to achieve a modern, efficient, and scalable banking platform.
Next Steps:
- Finalize Project Plan and Schedule
- Allocate Resources and Form Project Team
- Begin Phase 1: Project Initiation and Planning
Appendices
- Appendix A: Project Timeline and Milestones
- Appendix B: Detailed Cost Breakdown
- Appendix C: Risk Management Plan
- Appendix D: Stakeholder Communication Plan
- Appendix E: Technical Specifications of Temenos Transact, Paymentus, and LendingPad