Impact of Core Banking Solutions on Operational Efficiency in Large Financial Institutions

Authors: Hemalatha Murugesan

DOI: https://doi.org/10.37082/IJIRMPS.v14.i1.232997

Short DOI: https://doi.org/hbttxz

Country: United States

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Abstract: Core banking systems (CBS) form the technological backbone of large financial institutions. Increasing transaction volumes, omnichannel services, and regulatory scrutiny make legacy platforms operational bottlenecks. This study evaluates the impact of core banking modernization using a hypothesis-driven framework and a layered modular architecture model (LMCBA). Integrating API-first design, microservices decomposition, real-time ledger processing, and automated governance, the study demonstrates measurable improvements in transaction latency (25–40%), system uptime (up to 99.8%), reconciliation cycle time (30% reduction), and compliance reporting efficiency (25% faster). The proposed Operational Efficiency Index (OEI) provides a structured evaluation framework linking architecture to banking performance. Findings position core modernization as a strategic operational transformation rather than a purely technical upgrade.

Keywords: Core Banking Solutions, Operational Efficiency, API Architecture, Microservices, Financial Systems Modernization.

Paper Id: 232997

Published On: 2026-02-16

Published In: Volume 14, Issue 1, January-February 2026

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