When it comes to core providers, Temenos edged out six others as the “best in class vendor” in a matrix released last week.

The Aite-Novarica Group released its Aite Matrix: U.S. Digital Banking Solutions of CoreProviders ranks vendors by overall competitive position, stability, client strength, product features and client services. Temenos “has been able to successfully grow its brand over the last few years and is now a contender in most banks’ vendor evaluation processes, regardless of bank side,” the report notes.

“The Temenos Infinity platform is both feature-rich and UX strong, and has the ability to deliver on seamless end-to-end digital journey through a platform approach that connects legacy and fintech partners,” the report added.

The rankings of core digital banking solutions were in part based on a request for information completed by the vendors, and also relied on feedback from 51 end users at financial institutions across the United States.

This matrix evaluated solutions from six other vendors:

1. Computer Services, Inc.
2. Finastra
3. FIS
4. Fiserv
5. Jack Henry & Associates
6. Infosys Finacle

Finastra and Fiserv ranked as “leading contenders” while Jack Henry & Associates, Computer Services, Inc., and FIS ranked as “vendors to watch.” Infosys Finacle placed as an “emerging vendor,” a global “heavyweight” that “is attempting to penetrate the saturated U.S. digital banking market,” the report noted.

One factor that also drove Temenos’ position on the list was its financial wellness tools, the report stated. Banks and credit unions are increasingly looking to replace their personal financial management tools, which have faced stagnant adoption, with virtual financial coaches that can offer a more personalized and intelligent experience. A previous Aite-Novarica Group study surveyed 2,413 U.S. consumers 24 years or older and found 58% of respondents would use a virtual financial coach to help them improve their overall financial health, and 59% were willing to pay for such a service.

More banks will be signing new digital banking contracts with the leading digital banking vendors; the research group estimates 312 new contracts were signed in 2020, up from 292 reported in 2019, and that number is estimated to reach 335 in 2021, and 349 in 2022, based on vendor-reported sales and market knowledge.

U.S. banks and credit unions will spend approximately $2.1 billion on new digital banking solutions this year — an increase of 8.4% over 2021, the report notes, with spending expected to reach $2.26 billion by the end of 2022.

The Aite-Novarica Group identified digital banking adoption drivers as:

• The push for an omnichannel experience for customers, as well as more personalization via widgets and gadgets on customer interface;
• Digital account-opening integration;
• Card issuance, activation and control;
• Multiproduct and multisegment views, and the end-to-end customer experience;
• A push for more payment options;
• APIs and open banking; and
• Financial wellness programs that offer a virtual financial coach, rather than simply a personal financial management tool.

To support what retail banking customers want will require investment in artificial intelligence, onboarding automation and rich integration with fintechs and other third parties, the report notes. APIs will play a key role in creating that experience.

“APIs enable FIs and other financial services providers to share data and access third-party applications using common standards,” the Aite-Novarica Group noted. “This trend of open-banking will, over time, transform the industry, providing customers with more choice, better experiences, and more control over their data.”