Core Banking

By Author: Santhosh Kumar
Total Articles: 54
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A core banking system is the software used to support a bank’s most common transactions.
Core banking is a banking service provided by a group of networked bank branches where customers may access their bank account and perform basic transactions from any of the member branch offices.
Core banking is often associated with retail banking and many banks treat the retail customers as their core banking customers. Businesses are usually managed via the Corporate banking division of the institution. Core banking covers basic depositing and lending of money.

Elements of core banking include:
• Making and servicing loans.
• Opening new accounts.
• Processing cash deposits and withdrawals.
• Processing payments and cheques.
• Calculating interest.
• Customer relationship management (CRM) activities.
• Managing customer accounts.
• Establishing criteria for minimum balances, interest rates, number of withdrawals allowed and so on.
• Establishing interest rates.
• Maintaining records for all the bank’s transactions.

Core ...
... banking functions differ depending on the specific type of bank. Retail banking, for example, is geared towards individual customers; wholesale banking is business conducted between banks; and securities trading involves the buying and selling of stocks, shares and so on. Core banking systems are often specialized for a particular type of banking. Products that are designed to deal with multiple types of core banking functions are sometimes referred to as universal banking systems.