Modern Development Practices in Banking: A Playbook

Introduction

Welcome to the "Modern Banking eBook", a comprehensive guide for banking institutions embarking on the crucial journey of modernising their software development processes. I'm Romano Roth, and it's my privilege to walk you through the transformative steps that can reshape the way banks operate in the digital age. 

In today's fiercely competitive banking landscape, the impetus for modernisation is stronger than ever. This drive is fueled by the need for faster time to market, enhanced value for money, and—crucially—elevated customer satisfaction. These pillars are foundational to thriving in an environment where customer experience is not just a metric but the heart of differentiation. The modern banking ecosystem demands agility, innovation, and a relentless focus on delivering exceptional user experiences.

Banking and Modern Observability: Dynatrace Insights

Written by Andreas Grabner, DevOps Activist at Dynatrace and CNCF Ambassador

Introduction: How Observability is Changing

Observability has been around for as long as software engineering has been around. But it has clearly changed over the years!

If we look back 15 years, the classic three-tier application stack (web server, app server, database) with application runtimes such as Java and .NET resulted in a new area of observability tools called Application Performance Monitoring (APM). 

Those APM tools focused on monitoring rather static infrastructure and the dynamic behaviour of the application runtimes and business transactions. Financial organisations who connected those three-tier applications with their backend mainframe systems also started leveraging APM as some vendors expanded their support into z/OS, CICS or IMS to monitor the behaviour of end-to-end financial transactions.

Unlocking Efficiency: Transitioning to Modern CI Platforms

Written by Semaphore 

In the fast-paced world of technology, staying anchored to outdated continuous integration (CI) platforms can hinder an organisation's progress and stifle its growth.

Continuous integration is the beating heart of any software project. A poor CI experience impacts every aspect of the development process, from testing to deployment.

Legacy CI systems, once reliable, now struggle to keep pace with modern requirements, leading to frustrated developers and scalability bottlenecks. It's time for a change. Transition to modern CI platforms offering automated scalability, cost savings, and an improved developer experience. In this post, we delve into the challenges of legacy CI platforms and explore why organisations should embark on a journey toward modernisation.

I. Challenges of Legacy CI Platforms

Is your organisation hindered by legacy CI platforms? Have your engineers toiled to keep your legacy platform running? You're not alone. A CI platform is easy to take for granted until it starts holding your development team back. While your CI platform may have served you well in the past, it often struggles to keep pace with modern requirements, presenting challenges that can hurt productivity and growth.

Transitioning to Modern Feature Management with Feature Flags

Written by Ben Rometsch, Co-founder of Flagsmith and OpenFeature Governance Board Member

Introduction 

Developers working in banking and financial institutions often find themselves constrained by legacy systems that prevent them from deploying as frequently as they would like; instead, they are limited to monthly—or even quarterly—releases.

This is less than ideal for a number of reasons, but perhaps the biggest issue is that these deployments can become large and unwieldy, making them more error-prone. This is particularly stressful because banks can’t risk outages or issues with critical features, so the less high-stakes the release, the better. 

By transitioning to a more agile way of working that allows for more flexibility in the release process, developers can push features faster and more confidently. Feature flags are an important part of this toolkit, letting teams decouple deploy and release, remove bottlenecks, and increase release velocity. As banks begin to make the switch to modern feature management, finding tools that are built with data security in mind is essential. Look for tools that can increase agility while meeting your data security needs.

Transitioning to Modern Authorisation Management 

Written by Alex Olivier, CPO and Co-founder of Cerbos 

Navigating the ever-evolving landscape of authorisation management poses considerable challenges for companies. The dynamic nature of authorisation requirements, ranging from the addition of new roles to adapting to shifts in data security needs, demands a delicate and imperative approach. Legacy systems entrenched with hard-coded authorisation logic present hurdles in terms of scalability, developer experience, and responsiveness to changing business demands. 

For regulated industries aiming for compliance benchmarks like ISO27001, SOC2, or PCI, the fragmented nature of authorisation audit logs can pose significant challenges during audits or security incidents. In this environment, the inability to efficiently handle complex roles and permissions can impede a company's growth potential. 

Embracing Modernisation Through Platform Engineering

Written by Benjamin Brial, Founder of Cycloid

In today's dynamic banking landscape, managing legacy infrastructure has become increasingly complex. Ops are often more busy putting out fires than innovating solutions, and lack of centralised oversight leads to resource and budget drain. In addition to that, legacy infrastructure is harder to scale to the ever-evolving demands of customers and more complex security regulations. This is why many banks are looking towards embracing modern platform solutions. 

Platforms offer the promise of regulatory compliance, streamlined operations, and the ability to harness the latest technologies—everything that banks are currently struggling with. What are the benefits of self-hosted SaaS platforms? Can a GitOps approach bring about a real transformation? And what are the cultural challenges of implementing modern infrastructure management?

How Banks are Modernising to Approach Open Source

Written by Rob Moffat, Senior Technical Architect at FINOS

Introduction: Professional Open Source

When you think of open source, do you see visions of coders hacking away in an attic late at night, headlines about vulnerabilities being discovered (like Log4Shell), or hordes of zealous individuals at conventions such as FOSDEM or KubeCon?

The fact is, open source software infiltrated the firm long ago—the Synopsis OSSRA report (2023) estimates that 96% of all codebases contain some open source software and that 76% of all code is open source. Projects like Linux and Kubernetes are now key components in most firms’ cloud strategies. 

It is perhaps surprising to learn that a lot of open source software development is also now happening within the enterprise. Corporations are rolling up their sleeves and assigning staff to work on these projects, freely donating their time and resources to further the “common good” of open source projects that they deem to be “too important to fail”.

Big Players

Datamation’s 2023 report gives some idea of the main movers and shakers in professional open source: Amazon, Apache, IBM, Google, Intel, Microsoft, RedHat, Meta, Oracle, and so on. These are the big tech names you would expect to see here.

How Komerční Banka Modernised Its Banking Infrastructure Using Feature Flags

Meet Komerční Banka

Komerční Banka (KB) is a leading Czech Republic banking institution with over 1.6 million customers and nearly 400 branches. The bank was built on legacy systems with huge, distributed monolithic architecture. To stay competitive, KB felt the need to modernise its infrastructure and software development approach. Due to its large-scale operations, there was an urgent need to modernise its infrastructure and software development to stay competitive. 

Initial Challenges

KB had over 400 developers (out of 600) managing its legacy system built on monolithic architecture. The problem? The system consisted of heavily interdependent components that led to longer development cycles, higher bug risks, and a lack of system scalability.

These issues prompted KB's COE (Center of Expertise) to improve efficiency. As a result, they launched “The New Digital Bank” initiative—a five-year project migrating their infrastructure to a microservices-based architecture.

The goal was to modernise KB’s banking system and adopt an Agile 2.0 development mindset—resulting in better service delivery.

Conclusion

This eBook is a collaborative project between different leaders in software development, banking, and open source. Each contributor sees modernisation through a different lens, just as each financial services company chooses to modernise and release software in a different way. We started this project with transparency and collaboration in mind because there’s so much we can learn from one another in the open source community, the developer community, and the banking community.