Challenger banks lack outsourcing options, claims Metro Bank president

Matthew Finnegan

Speaking to ComputerworldUK at the time FIS executive VP, Mark Davey, said at the time that the US model of outsourcing provides significant benefits over the UK, where wholesale outsourcing is rare, but claimed that more could follow Sainsbury's Bank's example.

Meanwhile, banks emerging as the large lenders such as Lloyds and RBS sell off branches, including the newly re-launched TSB and Williams & Glynn, are currently running off their parent company's legacy systems, but will eventually move onto separate platforms.

According to Roe there is evidence that the use of outsourcing is increasing among the large banks, particularly as they come under regulatory and cost pressures, and predicts that new entrants will benefit as more turn to service partners.

"It is improving slowly, but as the banks attempt to meet the need of customers, regulators and to fight off competitors, they will have to use third party providers," he said.

"That will help them, but it will also help newcomers into the market by getting access to scale-advantaged software that they can pick up to run banking operations."

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