Capitalizing on Digital: Four Strategic Imperatives for Banks and Credit Unions

Imperative 2 | Core Systems: Let Digital Dominate

The separation between digital delivery and core processing is an enduring legacy of the branch-first era. And financial institution leaders are increasingly aware that their digital banking platforms, and their supporting architectures, may be holding them back.

Jack Henry canvassed 149 bank and credit union CEOs for its 2025 Strategy Benchmark survey. Included in the findings: Digital banking is far and away the top technology investment priority for banks this year, ahead of cybersecurity, AI, and data analytics. For credit unions, digital banking is a top-three spending priority, along with fraud prevention and automation.

The problem is that many institutions still adapt their digital capabilities to fit core limitations, which slows transaction speeds, undermines consistency across touchpoints, and constrains the ability to introduce new features.

In contrast, modern architectures dissolve the boundary between core and digital. The digital banking solution is no longer a bolt-on to the core; the core and digital come together to form the accountholder experience. That user experience is delivered through the digital channel, but when done correctly, it’s enabled by the modern core. Among other things, the core transformation requires robust use of shared APIs, consistent data structures, and unified development teams.

Leading financial institutions are coming to realize that core evaluations now must include an evaluable of their capability to enable the digital experience. Criteria like Availability, Reliability, Real-time, Speed and Security are now emerging as foundational requirements of a core to enable the digital experience. “If your core can’t keep up with your digital, you’re stuck playing catch-up forever,” said Jack Henry’s Paul Wiggins, Director of Sales, Digital Engineers.

The result is increased strategic impact and agility across the organization, enabling critical new capabilities to be built once and deployed across touchpoints, including mobile, web, and branch interfaces. A tokenized API approach, when applied to third-party data partners, also reduces friction and security vulnerabilities.

Financial institutions’ prioritization of digital banking suggests they recognize the core’s role has shifted. In a unified environment, product changes, compliance checks, and fraud controls can be deployed simultaneously to all channels, reducing duplication and operational complexity.

Imperative 3 | Data Architecture: Unify the Accountholder View

Surveys of banks and credit unions confirm that most institutions still see only a fraction of their accountholders’ financial lives. What is visible is largely limited to accounts and transactions held in-house, leaving out significant flows through fintechs, embedded finance platforms, and workplace benefits. This partial view limits personalization, slows fraud detection, and constrains product innovation. It also puts them at a disadvantage in a marketplace where the standard for digital experience has been set by the likes of Instacart, Amazon, and Uber.

For banks and credit unions, anticipating customer and member needs — and generating compelling and relevant recommendations — can be more challenging because so much relevant data lives on other institutions’ sites. The average individual has 14 financial apps, and the average Millennial family has 30-40, according to an analysis by Jack Henry.

A unified, real-time architecture integrates internal data with partner feeds and accountholder-permissioned external account data into a single profile. When all data lands in one environment, tagged and structured for analytics and user-facing functionality, institutions can detect needs earlier and respond with greater precision. Examples include:

• Personalization and targeted offers informed by an understanding of spending habits and a more complete financial picture.
• Fraud prevention that uses transaction patterns across all linked relationships to detect anomalies earlier.
• Product innovation that responds to real-world behaviors, such as peer-to-peer transfers in certain demographic segments.

“Most banks and credit unions only see a fraction of an accountholder’s financial life, and without integration you’re making decisions in the dark. If all your data streams into the same environment, you can spot patterns — like an accountholder starting to save for a down payment before they even ask for a loan.”

— Paul Wiggins, Jack Henry

According to Wiggins, Jack Henry has redesigned its architecture away from traditional screen scraping in favor of API-based tokenization. The vendor has built connections supporting a broad ecosystem of providers and aggregators (such as Plaid, Intuit, and Finicity). The API approach makes data immediately available and actionable for both the institution and the accountholder.