Commercial banks in Iran invest 18 percent of their net profit on IT services each year, while the global figure is about 35 percent, an expert said, warning that Iranian bankers must keep abreast of modern technological processes or they will soon suffer loss in their market shares.
“Banking processes are completely traditional and in need of major overhaul,” said Abotaleb Najafi, the director of Informatics Services Corporation, on the second day of the 4th Conference on E-Banking and Payment Systems held in Tehran on Jan. 26-27.
To correctly implement e-banking, bankers need to go beyond information technology, he said, quoted by BINA news website. Despite progress, “there is still a long way ahead until digital banking can be adapted.”
In the ending months of the year, banking transactions are expected to increase, he said, adding that people have come to trust the banking network.
“If the hard earned trust is in anyway broken, the potentials of the banking system will fall short.”
Core Banking
Core banking systems are provided by a network of branches where customers access their bank account and perform basic transactions from any of the member branches and are used in Iran.
Najafi added that lenders are dissatisfied with core banking software systems; if core banking systems do not operate efficiently, banks could suffer 20 percent losses in revenue.
Several scenarios have been offered by lenders to optimize core banking systems; unfortunately almost all are “premature” bankers alone cannot overhaul the systems, team work is essential in the process; industries and technologies must also join in for a fundamental yet reliable reform.
