Global Third-party Banking Software Market Size, Share & Industry Trends Analysis Report By Deployment, By Application (Risk Management, Business Intelligence and Information Security), By End-use, By Product, By Regional Outlook and Forecast, 2022 - 2028

Analysis of Market Size & Trends

The Global Third-party Banking Software Market size is expected to reach $40.6 billion by 2028, rising at a market growth of 8.0% CAGR during the forecast period.

A multi-channel program that handles several essential banking tasks, private wealth management, and business information are referred to as third-party banking software. The end-to-end omnichannel administration of banking operations is provided through an integrated and tailored software system. Commercial, retail, and trade banks utilize it largely to expand their interbank network and streamline their business processes.

The software helps to reduce losses brought on by human error, retain operational flexibility, enhance client satisfaction, and provide banks a competitive edge over rival financial institutions. The Core Banking, Multichannel, and BI segments make up the three major subgroups of the third-party banking software industry. Banks can offer their core banking services via a variety of channels due to third-party banking software providers.

As a result, banks are utilizing the advantages provided by third-party banking to transition to automated systems. Banks are becoming more and more reliant on mobile and internet channels as a result of their branch network contraction. As a result, it is becoming crucial for banks to give their consumers the choice to conduct financial operations quickly and securely using smart devices. This modernization process heavily relies on third-party banking software.

Positive growth effects are being produced by the increasing use of technologically sophisticated analytical tools like big data analytics. Large amounts of data must be processed effectively to make business decisions, spot market trends, and boost profitability. Being a data-driven enterprise, the banking sector relies on the use of third-party software connected with numerous analytical tools to manage data effectively.

The market for third-party banking software is expanding as a result of a transition from manual to computerized techniques for tracking and documenting financial transactions and bookkeeping. In keeping with this, the BFSI sector's increasing demand for process standardization and core banking systems is driving market expansion.

COVID-19 Impact Analysis

Particularly creating chances for the incorporation of third-party banking software is the increased demand for online banking solutions following the pandemic. Additionally, the development of online payment systems is enhancing the expansion of the sector. Digital financial services have been under the focus as a result of the COVID-19 pandemic and the requirement for social distance. Social isolation is made possible by digital financial services, which also enable governments to quickly and effectively provide money to people in need and give many households and businesses easy access to online transactions and financing.

Market Growth Factors

Analytics Integration With Third-Party Banking Software

The addition of analytics to third-party banking software is a significant component fostering the market's expansion. Due to the development of digital technology, consumers in the banking sector are altering how they access banking services. To communicate with businesses and obtain financial services, they are adopting mobile devices and digital technology. Due to this, the amount of client data held by businesses in the banking sector has increased exponentially. These businesses can examine the data they collect, enabling them to take quicker, more informed decisions that would increase efficiency across the board.

Financial Institutions Are More Likely To Become Third Party Banking

People worry about how reliable third-party software is. This is true if users seeking a program that will let them access every bank account they have. For many years, financial institutions have already earned the community's trust. Therefore, it is clear that financial organizations stand a higher chance of gaining customers' trust when viewed from the viewpoint of a bank user. For much third-party banking software, the hardest element would be attracting bank users and getting their permission to execute banking activities on their behalf.

Market Restraining Factors

Inadequate Internet Access In Poor Nations

It is one of the major obstacles preventing the market for third-party banking software from expanding. The main prerequisite for third-party banking software to provide highly effective and efficient operations is a powerful and high-quality network. Businesses using this software must have a reliable internet connection that enables them to function effectively in real-time. Furthermore, transferring data from connected devices like servers requires a lot of bandwidth. Additionally, businesses may suffer significant financial losses if the technology is unable to update real-time transactions, particularly in the investment banking industry.

Product Outlook

On the basis of Product, the Third-party Banking Software Market is segmented into Core Banking Software, Omnichannel Banking Software, Business Intelligence Software, Wealth Management Software, and Others. The wealth management software segment registered a significant revenue share in the Third-party Banking Software Market in 2021. It is because as more people look for asset management services to assist them to generate enough retirement income, the need for third-party wealth management software is anticipated to be driven by the retired population.

Deployment Size Outlook

Based on the Deployment Size, the Third-party Banking Software Market is divided into On-premise, and Cloud. The on-premise segment procured the largest revenue share in the Third-party Banking Software Market in 2021. It is because supremacy is ascribed to its simple customization possibilities, flexibility, and stronger security standards. After all, it operates on private servers.

Application Outlook

By Application, the Third-party Banking Software Market is classified into Risk Management, Information Security, and Business Intelligence. The business intelligence segment witnessed a significant revenue share in the Third-party Banking Software Market in 2021. It is because the third-party banking software's business intelligence application helps banks make informed decisions based on information about trends and consumer behavior. The industry is also being driven by end users' increasing usage of data analytics to examine the data generated.

End-use Outlook

Based on the End-use, the Third-party Banking Software Market is bifurcated into Commercial Banks, and Retail Banks. The retail bank’s segment acquired the largest revenue share in the Third-party Banking Software Market in 2021. Retail banks are predicted to have an increasing demand for third-party banking software as it lowers operating expenses. Furthermore, due to the effective and unified system of retail banking software, the needs of the clients are better recognized.

Third-party Banking Software Market Report Coverage

Report Attribute	Details
Market size value in 2021	USD 24 Billion
Market size forecast in 2028	USD 40.6 Billion
Base Year	2021
Historical Period	2018 to 2020
Forecast Period	2022 to 2028
Revenue Growth Rate	CAGR of 8% from 2022 to 2028
Number of Pages	287
Number of Tables	443
Report coverage	Market Trends, Revenue Estimation and Forecast, Segmentation Analysis, Regional and Country Breakdown, Competitive Landscape, Companies Strategic Developments, Company Profiling
Segments covered	Product, Deployment, End-use, Application, Region
Country scope	US, Canada, Mexico, Germany, UK, France, Russia, Spain, Italy, China, Japan, India, South Korea, Singapore, Malaysia, Brazil, Argentina, UAE, Saudi Arabia, South Africa, Nigeria
Growth Drivers	Analytics Integration With Third-Party Banking Software Financial Institutions Are More Likely To Become Third Party Banking
Restraints	Inadequate Internet Access In Poor Nations

Regional Outlook

Region-wise, the Third-party Banking Software Market analyzed across North America, Europe, Asia Pacific, and LAMEA. The North America region procured the highest revenue share in the Third-party Banking Software Market in 2021. It is due to the rising popularity of third-party software to boost operational effectiveness. Additionally, the presence of numerous significant businesses like Microsoft and IBM is anticipated to create a favorable picture for the industry's growth.

Free Valuable Insights: Global Third-party Banking Software Market size to reach USD 40.6 Billion by 2028

KBV Cardinal Matrix - Third-party Banking Software Market Competition Analysis

The major strategies followed by the market participants are Partnerships. Based on the Analysis presented in the Cardinal matrix; Microsoft Corporation is the forerunners in the Third-party Banking Software Market. Companies such as Accenture PLC, Infosys Limited, IBM Corporation are some of the key innovators in Third-party Banking Software Market.

The market research report covers the analysis of key stake holders of the market. Key companies profiled in the report include Microsoft Corporation, IBM Corporation, Oracle Corporation, SAP SE, Tata Consultancy Services Ltd., Infosys Limited, Accenture PLC, Capgemini SE, Fidelity Information Services (FIS), Inc., and Fiserv, Inc.

Strategies deployed in Third-party Banking Software Market

» Partnerships, Collaborations and Agreements:

• Jun-2022: Microsoft came into a partnership with Technisys, the Core banking software. Together, the companies aimed to combine Microsoft Cloud for Financial Services within its Cyberbank platform to deliver financial institutions the capability to climb and increase their digital transformation measures. Moreover, this partnership would authorize companies to innovate faster and concentrate more on providing worth to their consumer, versus preserving their heritage systems.
• Apr-2022: Tata Consultancy Services came into a partnership with SBI Cards and Payments Services, a pure-play credit card business and payment solutions provider in India. With this partnership, TCS would digitalize and transform the online onboarding procedure to allow a quick turnaround and frictionless experience desired to propel greater consumer fulfillment. Moreover, the partnership would allow SBI Card to further expand its e-card issuance, satisfying end consumers and providing it with a competitive boundary in the industry.
• Feb-2022: Tata Consultancy Services formed a partnership with MATRIXX Software, a provider of a cloud-native converged charging system. With this partnership, the companies aimed to integrate TCS HOBS and MATRIXX Digital Commerce Platform which would allow CSPs to concentrate on technological and commercial innovations that would rapidly capture the vision of end consumers and help grow market value.
• Dec-2021: Microsoft joined hands with Temenos, the banking software company. Through this collaboration, the companies aimed to fulfill the increasing need from banks for SaaS and banking services provided by the Temenos’ Banking Cloud. Additionally, companies integrated strengths would expand the opportunities of the cloud for banks and financial institutions worldwide, allowing them to develop differentiated consumer experiences, drive time to value, and propel innovation for reliable growth.
• Dec-2021: Accenture joined hands with OP, Finland’s largest financial services group. Together, the companies aimed to design and offer new services that would additionally optimize OP’s digital banking processes. Additionally, utilizing the automation and AI abilities of myWizard, merging human ingenuity with digital abilities to transform operations and ways of working to assist OP to develop a future-ready banking practice that places consumers and workers at the center.
• Nov-2021: Microsoft teamed up with Backbase, the global Engagement Banking Platform supplier. Through this collaboration, the combined value offer of Backbase’s Engagement Banking Platform on Microsoft Cloud for Financial Services delivers an entire industrialized stack of pre-integrated abilities that manage banks’ necessities for effectively executing their digital modification.
• Nov-2021: Infosys Finacle joined hands with IBM, a technology company. Through this collaboration, the companies aimed to introduce Finacle Digital Banking Solution offering on Red Hat OpenShift and IBM Cloud which would allow banks to increase business transformation, evolve more elegant, and power their growth with an on-demand offering of products and services. Additionally, collaboration would aid banks to execute seamless ecosystem connectivity and deliver a world-class banking experience for their consumer, and allow them to fulfill mandated submission and security necessities.
• May-2020: Infosys formed a partnership with Avaloq, the foremost wealth management software. With this partnership, Infosys aimed to extend its leadership position and deliver SaaS and BPaaS services to the global wealth management segment. Additionally, Avaloq’s industry-leading wealth management products combined with Infosys’ proven delivery strengths would deliver a combined end-to-end solution for wealth management.

» Product Launches and Product Expansions:

• Jul-2021: Fidelity Information Services introduced the new components to its flagship cloud-native core banking platform. The new feature contains innovative retail lending and commercial onboarding and an increasing ecosystem of third-party solutions, adding to the advanced digital banking abilities offered by a dozen teaching banks. Additionally, new components continue the development of the platform as one of the most open, powerful, and scalable banking systems in the industry.

» Acquisitions and Mergers:

• Aug-2022: Accenture completed the acquisition of Tenbu, a cloud data business specialized in solutions for intelligent decisions. This acquisition expands Accenture’s Cloud First abilities via Latin America and globally to obtain the company’s data and AI expertise, industry deepness, and repeatable creation with the cloud ecosystem to allow consumers to express the business value of data.
• Jul-2022: Accenture took over Solvera Solutions, a Regina-based company providing platform-led digital transformation services. With this acquisition, Solvera Solutions carries extensive experience on the ServiceNow platform, develops Accenture’s current portfolio on the Microsoft Modern Workplace and Microsoft Power Platform, and improves abilities and resources in SAP S/4HANA.
• Apr-2022: Infosys completed the acquisition of Oddity, a Germany-based digital marketing company. This acquisition reinforces Infosys’ branding, creative, and experience design abilities. Additionally, Oddity brings to Infosys a complete service offering including digital-first brand communication and management, in-house production, such as virtual and augmented reality, experience strategy, and e-commerce services along with its metaverse-ready set-up within Europe.
• Apr-2022: Fiserv completed the acquisition of Finxact, a core banking software developer. With this acquisition, Fiserv is boosting the capability of financial and fintech institutions to provide differentiated digital banking experiences to their consumers.
• Feb-2022: Fidelity Information Services completed the acquisition of Payrix, an implanted payments company. This acquisition would authorize FIS to improve embedded payments and finance experiences for small- and medium-sized businesses in any enterprise, boosting the company’s fast-growing e-commerce enterprise.
• Aug-2021: Accenture took over Edenhouse, a UK-based independent SAP associate. This acquisition would grow Accenture’s abilities in the UK to manage boosted demand for SAP’s cloud-based solutions. Additionally, the acquisition would further improve Accenture’s abilities to help clients in their digital transformation journey.

Scope of the Study

Market Segments Covered in the Report:

By Deployment

• On-Premise
• Cloud

By Application

• Risk Management
• Business Intelligence
• Information Security

By End-use

• Retail Banks
• Commercial Banks

By Product

• Core Banking Software
• Wealth Management Software
• Omnichannel Banking Software
• Business Intelligence Software
• Others

By Geography

• North America
  • US
  • Canada
  • Mexico
  • Rest of North America
• Europe
  • Germany
  • UK
  • France
  • Russia
  • Spain
  • Italy
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • Singapore
  • Malaysia
  • Rest of Asia Pacific
• LAMEA
  • Brazil
  • Argentina
  • UAE
  • Saudi Arabia
  • South Africa
  • Nigeria
  • Rest of LAMEA

Key Market Players

List of Companies Profiled in the Report:

• Microsoft Corporation
• IBM Corporation
• Oracle Corporation
• SAP SE
• Tata Consultancy Services Ltd.
• Infosys Limited
• Accenture PLC
• Capgemini SE
• Fidelity Information Services (FIS), Inc.
• Fiserv, Inc.