The bank’s job is assembling other people’s technology
Banks used to buy technology from outside vendors. Now those vendors are becoming part of how the bank actually runs. In this issue’s Letter from the Editor, Sara Khairi traces how cores, cloud infrastructure, payments, data, and increasingly AI agents are all being built and operated by companies outside the institution, while the bank still owns the customer relationship, the balance sheet, and the regulatory consequences when something breaks. KPMG’s 2026 Banking Technology Survey found 71% of banking executives now say they need to modernize platforms to bring products to market, up from 46% in 2025.
That embeddedness creates a new kind of dependency. J.P. Morgan can afford to build much of its own stack, planning to spend roughly $19.8 billion on technology in 2026, but most banks, especially community and regional players, are buying rather than building, and increasingly consolidating around vendors that can connect their other partners. Khairi argues the real technology advantage is no longer any single product but how well a bank makes externally built systems function as one, and that raises the harder question: which parts of the stack does a bank need to own, which does it need to control, and which can it safely hand off?
Read more →
|
