Founded in 2008, the Banking Industry Architecture Network (BIAN) is a not-for-profit collaborative ecosystem that aims to establish a banking technology framework that standardizes and simplifies core banking architecture. Its common framework addresses banking interoperability issues and aims to drive collaboration, agility, and innovation for the sector. BIAN released its first standard framework in 2012 and has been evolving continuously to bring in more inclusive standards across the banking landscape. SunTec joined BIAN in 2020 to collaborate with member organizations and help them define and create a customer-centric Digital Banking Architecture. Since then, SunTec has not only conformed with the BIAN standard but has also played a pivotal role in helping shape the standard. In this article we delve into the significance of BIAN for the banking industry and SunTec’s pioneering journey to the BIAN conformance.
BIAN – Ensuring Interoperability and Composable Architecture
The banking technology adoption has progressed one step at a time, with one technology solution being adopted to solve a specific priority, followed by another. For example, banks implemented automatic ledger posting machines (ALPM) in the branches first, then standalone branch automation, then moved to core banking transaction systems, followed by internet banking and so on. These surely enabled banks to do more for customers, but unfortunately this created a large, complex, and unwieldy banking technology that slowed down processes and hindered innovation. Standards such as BIAN aim to address such challenges by introducing standardization and interoperability measures. It considers the entire bank as a singular business organization and models real-world behaviors inside business-enabling functions or service domains across the entire organization.
For instance, the latest framework, Service Landscape Architecture 12.0 from BIAN includes 326 service domains identified across 38 functions referred as business domains in BIAN world. These business domains are further converted to 1489 business objects and 2149 business attributes mapped against 5227 service operations across functions. These functions are not limited to core banking alone but include diverse operations right from business development to financial management to talent management or risk management and so on. It presents a cohesive view of the organization where every function is connected to the other and this is precisely the reason why BIAN framework 12.0 covers 3398 service connections with the operations in the organization. Banks will continue to have multiple technology products at play, as it is unlikely that one product will be able to meet diverse requirements from different business lines. And the same solution may be used in two or more functions. With standard frameworks in place there can be multiple technology providers operating within the unified business unit that is the bank. As more service units and service providers conform with the standard, systems can be easily aligned, integrated, and leveraged in unison to deliver faster, accurate, and innovative outcomes.
Further, such a standard also addresses the question of composable architecture. Composable architecture refers to building complex systems from smaller, independent, and reusable components that interact through 249 well-defined interfaces or APIs. This approach ensures that software being developed is flexible, scalable, and easy to maintain. BIAN provides a standardized framework for this composable architecture specifically tailored for banking systems. It defines standard business capabilities and service domains. It specifies standards for interfaces to enable effective integration of multiple applications within a bank’s larger IT landscape. By adhering to these standards banks can create a modular, interoperable, and agile IT landscape that facilitates easy integration, and easily adopt a composable architecture that combines both older and emerging technologies.
The Benefits of Conformance
The BIAN framework offers some tangible benefits:
- Interoperability: By using the standard interfaces and service definitions, different systems and applications can work together seamlessly. This reduces connectivity costs and time to market, allowing banks to launch new products and services faster.
- Modularity and Reusability: A modular approach allows components to be easily reused across multiple applications, ensuring IT infrastructure flexibility and scalability.
- Reduced Complexity: Modular and reusable components simplify interaction between multiple systems, reducing operational costs and improving reliability. The compliance with globally accepted standards fosters trust between banks and their service providers.
- Regulatory Compliance: Standardization helps banks and solution providers align more easily with regulatory requirements, making the entire ecosystem more agile and compliant.
- Innovation: Standardization speeds up the innovation process, increasing the likelihood of achieving innovative outcomes quickly. This is crucial for maintaining competitive advantage.
The banking sector is evolving at an incredible pace and innovation is key to future growth and success. The future of banking success will depend on the 2CI model – better Customer experience via Collaborative Innovation. The adoption of standards will help banks to deliver a seamless and personalized experience across touchpoints because it standardizes the service landscape. The channel used by the customer, or their geographical location will have no bearing on their experience as the building blocks of the service or product will be standardized. And as the larger banking ecosystem conforms to standards, there will be multiple partners using the same standardized building blocks and communicating in the same language. And this standardized ecosystem will ensure rapid innovation where new technologies can merge easily with older systems to offer a better experience and enhanced service delivery.
SunTec’s Journey to BIAN Conformance
SunTec joined BIAN in 2020 and started working on BIAN conformance by January 2023. SunTec is not a core banking transaction system, but its flagship platform SunTec Xelerate handles significant banking revenues. Therefore, we began the process by mapping the BIAN standards to SunTec Xelerate and defining which building blocks were applicable. We then matched it to BIAN’s service domains. Through this process SunTec was a member of the BIAN Product Certification Working Group and worked closely with the Chief Architect and other members to ensure that SunTec Xelerate was the first in its category to conform to the BIAN Service Landscape 11.0. SunTec is now in the process of re-conforming with BIAN Service Landscape 12.0.
Our Role in Shaping BIAN Standards
More importantly, as a member of the BIAN Product Certification Working Group, we have played a crucial role in shaping the standards to include more players within the banking technology space. Initially BIAN had three key roles:
- Core or foundational systems that perform key functions independently like core banking systems.
- Proxy or systems that were dependent on other systems for some functions, like CRM systems that require data from the master system.
- External or those systems that are not essential for transactions or key services but perform specific tasks, like document management systems.
SunTec Xelerate is a specialized platform that performs crucial tasks like managing revenue, billing, and pricing by aligning with core banking systems. It did not fit into any of these categories. SunTec proposed new roles to the working group to accommodate them and other service providers that are not core banking systems but provide critical services. As a result of our efforts, BIAN now recognizes four roles – Core Complete, Core Partial, Proxy, and External. We are now a member of other working groups such as the BIAN Adoption Working Group, and the BIAN Certification Working Group. We are hopeful that our association will continue to help shape standards that will benefit the community and the broader banking sector.
Conforming with standards is not a passing fad but a strategic imperative for both banks and technology providers. It ensures interoperability and collaboration, which are critical building blocks for customer-centric innovation. For banks, these standards can help modernize IT architecture, making it more composable while improving operational efficiency, scalability, and agility. They will be empowered to respond quickly to market changes and customer requirements and accelerate the pace of innovation. Technology providers that conform with standards can foster trust, transparency, and drive collaboration within the sector. Together, banks and technology providers can usher in a new era of industry wide innovation and shape the future of banking.
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