RBC Chief Says Banks Need to Modernize Legacy Systems

As with most industries, the banking and financial sector has become increasingly digital, and that has forced companies to invest more heavily in their IT systems than ever before. Whether it's customer-facing assets like mobile banking solutions or internal databases used to make key decisions, banks today are only as good as their IT infrastructures.

But according to American Banker, the push to modernize IT infrastructure hasn't happened at the pace it needs to. That's the position of Dave McKay, chief executive of Royal Bank of Canada, who told participants during a roundtable discussion that the fundamental challenge of banking today is evolving in a time when everything is done virtually.

"We used to know our customers because they use to visit us physically," McKay said in the discussion. "We used to put that picture together from interactions on a weekly basis. We have to rethink how you rebuild a profile to understand them in a digital world and be relevant."

Among the biggest obstacles to this goal is the over-reliance on legacy IT hardware and software that most financial institutions are dependent upon. Outdated systems have led to glitches, security issues and a diminished ability to make full use of the data at most banks' disposal.

Of course, it's not as simple as just replacing all legacy applications and systems with new ones – continuity and access to old data is still essential for many critical functions, and cost considerations must always be taken into account.

One way in which banks and other financial institutions can use modern tools without a total system overhaul is through a secure and reliable Web-based terminal emulator like the Flynet Viewer. This will give them the ability to access older mainframes through mobile devices and updated interfaces that reduce the amount of time spent training employees to use outdated software.