For credit unions, this concept became very visible as online banking became a market requirement. Types of online banking software were developed differently than traditional cores were, so they were created as distinct modules. There are many examples of modules existing today that interact with the core, but are independent of the core.

Today, modular solutions are the mainstay of the credit union technology landscape. Most cores offer basic functionality for the majority of credit union lines of business – but this functionality may not meet all the specific needs of an individual credit union.

For this reason, the requirements for what is “in the core” are moving quickly back to the original definition. The core today focuses on the paramount requirements of integrity, security and regulatory compliance for all transaction data. Additional capabilities are increasingly delivered by modules that reside outside the core itself.

The industry's migration to this modular approach has developed a new type of value proposition – that of integration.

In many solutions, integration is what drives the value difference between “best of suite,” where all the modules are part of a single product family, and “best of breed,” where modules are pulled from multiple product families. Because best-of-suite products are all aligned to a single approach, methodology, and look and feel, they typically enable tighter integration and facilitate more seamless interactions. “Best-of-breed” products can be independently advantageous, but because the credit union has to take on the responsibility of the integration of the modules, there may be added costs or a material impact on the IT team to own and maintain those integrations.

Given the many things we buy today, we shop not only for the technology itself, but for the ecosystem of modules that surrounds it – such as app stores and cloud services for computing and mobile devices. Credit unions are in the same position and the analysis of any core needs to include the complete ecosystem of modules, support, integration options, extensibility and total cost of ownership to really understand the potential return on investment.

As the core settles back into its original mission as the secure, reliable and predictable source of transaction truth, the ecosystem of modules that provides the functions credit union employees and members interact with daily has become just as important as the core itself.

And, the value of the integration of those modules with the core, and with each other, is becoming the key differentiator for credit union performance and member satisfaction.

Ryon Packer is SVP, enterprise product strategy, credit union solutions for Fiserv. He can be reached at 469-287-3600 or [email protected].