Data Preparation for Core Banking Systems

Core systems are loaded with data. Data related to deposits, loans, customer information, including General Ledger activity for accounting. Not to mention ancillary products/systems such as Debit Cards, Credit Cards, ATMs, ACH activity, and much more.

Fundamentally there are two sources of data within these systems: Databases & Reports (or extracts).

Databases

Core systems have databases which record all the activity associated with products and customer information activity. In theory, if a business user (which we can loosely define here as any employee that has a need to access data to perform their assigned duties) can simply access the database they will get access to what they need to do their job, right?

Not exactly.

There are a few challenges related to databases for business users, namely;

1. Accessibility

2. Business Logic

3. Audit

Accessibility

Not everyone is granted access to the core system database for various reasons:

Security: IT departments are concerned about who has access to the database, even if it is read only. They have to monitor access and it has to be justified.

Cost: In some cases there are additional overhead costs associated with granting access to users of a database.

Performance: IT professionals are also concerned about the performance of the database. One user can run a query that runs for hours, which can impact others using the database.

Business Logic

Let’s say we get past the initial hurdle of access. The next hurdle to clear is critical: Business Logic.

Once granted access to a database, you need to know what you’re looking for, and how to find it. This is not easy as databases can contain 1,000s of tables, with millions of records, hundreds of columns….where do you start?

Audit

Finally, how do you know that you’re pulling the right data together?

Overall this leads to the many measures of data quality; accuracy, completeness, relevance, reliability, timeliness

Do you trust the data? If it’s financial data for reporting, is it accurate? Is it relevant?

For example, it is not uncommon for databases to purge data after a particular time frame (monthly, quarterly etc) for capacity reasons.

For these reasons, working with databases (if granted access), is not easy.

Reports

This brings us to the second type of data source: Reports.

What is a Report?

Reports are human-readable files that provide a point-in-time view of data for the business.

Reports are developed by the vendor (sometimes in collaboration with customers), and they contain relevant business logic for the business need.

Core Banking systems come with a set of “Canned” reports, or Standard Reports, already developed by the vendor. These reports provide the easiest historical snap shot of data.

They are also less expensive than accessing or rebuilding the data in the database. Why reinvent the wheel?

Reports are always available in a timely manner, and it is easier to grant access to reports than to a database.

Lastly, report data is trusted and audited. It’s what the auditors want to see.

Whats Next?

Now that we’ve talked about this in our next set of blog posts we will review a few core systems and some examples of the kinds of reports in these systems.