In a banking sector undergoing full digital transformation, evaluating a core banking platform represents one of the most critical challenges for financial institutions. According to the BCG 2025 report, more than 60% of banking IT spending is devoted to maintaining existing systems rather than driving innovation, highlighting the urgency of rigorous technology due diligence. This evaluation determines not only an institution's ability to serve its customers today, but also its capacity to adapt to tomorrow's regulatory and technological changes. The experience of the Arrawaj Foundation, which successfully migrated over one million customers to a new platform in 18 months, perfectly illustrates the importance of informed technology selection.

Fundamentals of Technology Due Diligence for Banking Platforms

Definition and Stakes of Technology Assessment

Technology due diligence in the banking context consists of comprehensively evaluating the technical, functional, and strategic capabilities of a platform before adoption. This approach goes well beyond a simple feature comparison to encompass technical architecture, security, scalability, and long-term viability of the solution. The BearingPoint study reveals that institutions using a structured evaluation framework with over 150 questions across seven dimensions achieve better results in their digital transformation. This methodical approach helps identify the strengths and weaknesses of each solution based on the institution's specific needs.

Key Dimensions to Analyze

Evaluating a core banking platform must be structured around several interconnected dimensions. Functional richness constitutes the first pillar, encompassing the platform's ability to cover all of the institution's business verticals. Technology prowess represents the second pillar, including cloud-native architecture, API integration capabilities, and investment in emerging technologies like artificial intelligence. Service depth, vendor long-term viability, client references, operational performance, partner ecosystem, and total cost of ownership complete this analysis grid. Each dimension must be weighted according to the evaluating institution's context and strategic priorities.

Evolution of the Banking Technology Landscape in 2025

The 2025 banking technology landscape is characterized by accelerated cloud adoption, the rise of artificial intelligence, and the widespread adoption of open banking. According to the BCG report, institutions that simplify their technology architecture and optimize their investments can redirect more than 50% of their IT spending toward transformation initiatives. This evolution demands a more sophisticated technology due diligence approach, considering not only platforms' current capabilities but also their future adaptability. Solutions like Basikon illustrate this new generation of digital-native platforms, designed to easily integrate with new technologies and support exponential growth.

Architecture and Infrastructure: Evaluating Technical Foundations

Security and Operational Resilience

Banking security constitutes a non-negotiable prerequisite in evaluating any core banking platform. A multi-layered security architecture must include native multi-factor authentication, SSO integration, end-to-end encryption, and continuous threat monitoring. Operational resilience goes beyond simple security to encompass the platform's ability to maintain critical services even during major disruptions. The evaluation must cover backup mechanisms, business continuity plans, guaranteed recovery times, and the ability to handle exceptional load spikes. Institutions must also verify that the platform meets international security standards and local regulations specific to their operating market.

Scalability and Performance

Banking scalability represents a determining criterion in a context of accelerated digital growth. A modern platform must be able to handle millions of daily transactions while maintaining optimal response times. NoSQL architecture, like that used by Basikon, offers superior flexibility and performance compared to traditional relational databases. The evaluation must cover horizontal scaling capacity, traffic spike management, caching mechanisms, and query optimization. Performance testing under load must simulate real usage conditions, including expected transaction volumes and exceptional stress scenarios like high commercial activity periods.

Cloud-Native Architecture and API Integrations

Modern cloud banking architecture relies on cloud-native design principles that guarantee flexibility, scalability, and resilience. A truly cloud-native platform follows CNCF 12-factor framework recommendations and can operate agnostically across different cloud providers. Banking API integration capabilities constitute the nervous system of the modern technology ecosystem, enabling fluid connectivity with third-party systems, fintech partners, and external data services. The evaluation must cover API richness, documentation, performance, security, and ability to support complex integrations. The case of Orion Leasing demonstrates the importance of these capabilities, with successful integration to over 25 data platforms via API, enabling automated credit decision processing in less than 20 seconds.

Business Functionality and Configurability

Functional Coverage and Service Richness

The functional coverage of a core banking platform must be evaluated based on the specific needs of each customer segment served by the institution. A corporate bank requires sophisticated syndication management, cash management, and trade finance functionalities, while a microfinance institution will prioritize managing large portfolios of small loans and automated scoring tools. Service richness encompasses not only basic functional modules but also reporting, analytics, and regulatory compliance tools. The evaluation must cover each module's depth, its ability to handle complex use cases, and its future evolution according to the vendor's product roadmap.

Flexibility and Configuration Capabilities

Technology flexibility represents a major competitive advantage in a constantly evolving banking environment. A modern platform must enable configuration of new financial products without specific development, customization of business workflows, and adaptation to local regulatory specificities. Configuration capabilities must be accessible to business teams without systematically requiring technical team intervention. The low-code approach, like that offered by Basikon, can significantly reduce time-to-market for new products and services. The evaluation must cover the configuration interface, available documentation, customization limits, and validation and testing mechanisms for configurations.

Support for Complex Business Processes

Complex banking processes require a platform capable of managing sophisticated workflows, advanced business rules, and multiple integrations. Managing complex organizational hierarchies, power delegations, multi-level approval processes, and automated compliance controls constitutes a major technical challenge. A modern platform must offer a configurable workflow engine, process modeling tools, and complete audit and traceability capabilities. The experience of the Arrawaj Foundation, which configured over 830 different business processes, illustrates the importance of these capabilities in managing complex large-scale banking operations.

Technology Ecosystem and Integrations

Integration and Connectivity Capabilities

The integration capabilities of a core banking platform determine its ability to function in a heterogeneous technology ecosystem. A modern platform must support a variety of integration protocols, from REST APIs to ISO 20022 messages, including webhooks and ready-to-use connectors. The evaluation must cover ease of integration with existing systems, management of multiple data formats, and ability to process large volumes of real-time exchanges. The CSI checklist recommends specifically verifying open banking capabilities, essential for leveraging platform banking opportunities and developing new revenue streams. Institutions must also evaluate the robustness of error handling mechanisms, incident recovery, and integration monitoring.

Partner Ecosystem and Marketplace

The partner ecosystem of a core banking platform constitutes a major differentiating factor in innovation capacity and adaptation to future needs. A rich ecosystem provides quick access to specialized functionalities without costly internal development. The evaluation must cover the quality and diversity of technology partners, ease of integrating their solutions, and certification and support mechanisms. Leading platforms generally have a third-party application marketplace, partner certification programs, and development tools to facilitate integrations. The platform's ability to evolve toward a banking operating system model, where it orchestrates a set of specialized services, becomes an increasingly important selection criterion according to Finacle analysis.

Regulatory Compliance and Governance

Regulatory compliance represents a permanent challenge for financial institutions, with requirements that constantly evolve according to jurisdictions. A modern platform must integrate automated compliance tools, alert and regulatory reporting mechanisms, as well as complete audit and traceability capabilities. The evaluation must cover regulatory coverage by geographic market, frequency of regulatory updates, training and support tools offered by the vendor. Data governance constitutes a critical aspect, including access rights management, modification traceability, and privacy protection. Institutions must verify that the platform supports the specific requirements of their business sector, whether microfinance, leasing, or traditional commercial banking.

Long-Term Viability and Support

Vendor Assessment and Client References

Vendor evaluation constitutes a crucial aspect of due diligence, particularly in a market where many investment fund-backed players struggle to achieve profitability. The analysis must cover the vendor's financial health, growth trends, profitability, and ability to invest in long-term innovation. Client references represent a reliable indicator of solution maturity and support quality. It is essential to obtain references from institutions of similar size and profile, operating in comparable markets. The experience of Orion Leasing, which succeeded in its multi-country expansion thanks to an adaptable platform, or that of the Arrawaj Foundation with its complex legacy system migration, provide concrete examples of success in demanding contexts.

Total Cost of Ownership and Economic Model

The total cost of ownership (TCO) of a core banking platform goes well beyond the initial license cost to include implementation, training, maintenance, evolution, and support costs. The evaluation must consider costs over a 5 to 10-year horizon, including version upgrades, regulatory adaptations, and transaction volume growth. Economic models based on open-source components can offer significant TCO advantages while reducing vendor lock-in risks. The SaaS approach generally enables better cost predictability and reduced infrastructure investments. Institutions must also evaluate potential hidden costs, such as customization fees, integration costs with existing systems, and implications in terms of required internal resources.

Product Roadmap and Innovation Capacity

The product roadmap and vendor's innovation capacity determine the platform's ability to evolve with the institution's future needs. The evaluation must cover R&D investments, release frequency, integration of emerging technologies like artificial intelligence and edge computing. A roadmap aligned with market trends and needs expressed by the user community constitutes a guarantee of future relevance. The vendor's ability to anticipate regulatory and technological changes, as illustrated by Basikon's approach to banking infrastructure transformation, represents a sustainable competitive advantage. Institutions must also evaluate feedback and co-innovation mechanisms offered by the vendor, as well as its ability to customize its roadmap based on major clients' specific needs.

Best Practices Summary and Strategic Recommendations

Technology due diligence for a core banking platform requires a methodical and structured approach, based on a comprehensive evaluation framework and selection criteria weighted according to the institution's strategic priorities. Experience demonstrates that institutions that invest sufficient time and resources in this evaluation phase achieve better results in their digital transformation. Establishing a multidisciplinary evaluation team, including business, technical, and financial representatives, enables comprehensive analysis of all critical aspects. Using a structured selection process, with objective evaluation criteria and thorough practical testing, significantly reduces poor selection risks. Since banking digital transformation is a marathon rather than a sprint, choosing a reliable and innovative technology partner like Basikon constitutes a major strategic investment for the institution's future.

The success of a core banking transformation project relies as much on the technology solution's quality as on the vendor's ability to support the institution in its change process. Best practices recommend favoring a long-term partnership approach rather than a simple client-supplier relationship. Discover how Basikon can support you in your technology evaluation and transformation. Request your personalized demonstration and benefit from our specialized consultants' expertise.

FAQ - Frequently Asked Questions

What are the priority technical criteria for evaluating a core banking platform?

Priority technical criteria include cloud-native architecture, API integration capabilities, multi-layered security, horizontal scalability, and configuration flexibility. Compliance with international standards and ability to support large transaction volumes also constitute essential prerequisites.

How to evaluate the security and resilience of a banking platform?

Security evaluation must cover multi-factor authentication, end-to-end encryption, continuous threat monitoring, and backup mechanisms. Resilience is evaluated through business continuity plans, guaranteed recovery times, and ability to maintain critical services during major disruptions.

What importance should be given to client references in the selection process?

Client references constitute a reliable indicator of solution maturity and support quality. It is essential to obtain references from institutions of similar size, operating in comparable contexts, and to concretely verify the benefits obtained and difficulties encountered during implementation.

How to calculate the total cost of ownership of a core banking platform?

TCO includes license, implementation, training, maintenance, evolution, and support costs over a 5 to 10-year horizon. Infrastructure costs, mobilized internal resources, and integration costs with existing systems must also be considered.

What are the pitfalls to avoid during technology evaluation?

Main pitfalls include excessive focus on features at the expense of architecture, underestimation of integration costs, insufficient verification of client references, and neglect of vendor financial viability evaluation. Governance and regulatory compliance aspects must also not be overlooked.