Our Position

Core Processors


  • ICBA strongly urges core processors and other technology partners to help community banks enhance their market position and achieve ongoing efficiency by:

    • Meeting and exceeding evolving customer expectations for banking and payments products and services in a timely manner.

    • Complying with legal and regulatory requirements.

    • Managing operational risk.

    • Providing information about incident response and business continuity plans.

  • Enhancing customer information security.

  • ICBA urges technology partners to engage in negotiations with community banks that result in contracts that are reasonable, fair, and clearly disclose fees.

  • ICBA urges core processors to provide adaptable, flexible, timely, and affordable platforms that enable community banks to innovate in a nimble and efficient manner through open application programming interfaces (APIs).

  • ICBA encourages core processors and digital banking providers to develop systems that permit bank customer-authorized data sharing with third parties through APIs, which replace third-party collection and storage of customer online banking credentials and limit the amount of data accessed by third parties.

  • ICBA urges core processors to provide access to secure data analytics solutions so community banks can better understand and serve their customers and leverage market opportunities.


The Critical Role of the Core Processor Relationship. Over the years, the community bank-core processor relationship has evolved from a back-office record-keeping vendor relationship to a digital cornerstone of the bank’s relationship with its customers.

Core processors play a critical role in providing open communication, visibility into cyber and operational risk management, and education regarding new and enhanced products and services, modern technology, and marketplace developments. The community bank-core processor relationship should be treated as a key strategic relationship, given the critical role of the core processor in supporting a community bank’s long-term technology and business objectives, ability to remain compliant, and for the bank’s continued success.

ICBA encourages community banks to remain actively engaged with their technology partners to influence innovation, product development and speed to market so banks remain competitive.

Contract Terms. Community banks must negotiate relationships with technology providers which bolster their ability to compete and flourish. Contracts must clearly define terms, with reasonable fees for services and access to bank data, and provisions that assign liability to the technology partner when it is responsible for failing to meet service level standards or is unable to deliver the contracted services.

Core Processing Technology. Core processing technology, the foundational infrastructure for customer transactions, balances, and histories, is now under greater industry scrutiny and market pressure due to advances in digital banking channels, as well as the entry of non-traditional firms. The established and interconnected nature of core processing technology further compounds community banks’ reliance on these capabilities to stay compliant, competitive, efficient, and viable. Forward-thinking core processors enable early adoption and speed to market at a price supporting community banks’ revenue growth, providing community banks with a considerable competitive advantage.

Open Infrastructure. Open core infrastructures allow banks to innovate more efficiently, reducing the effort and expense of fintech and third-party integrations with the core platform. APIs are becoming the preferred industry standard for allowing bank customers to securely share their personal financial data with authorized third parties without forfeiting usernames and passwords. Access to core data through APIs enables community banks to offer enhanced customer experiences while limiting the scope of data a permissioned third party can access.

Data Analytics Solutions. To compete, community banks require access to their data and analytical solutions which provide actionable insights for serving their customers. Currently, many of the core processor solutions are limited to historical reporting or may be cost-prohibitive, and therefore do not provide community banks with the ability to harness the power of sophisticated data analytics to execute their strategy. Uncovering the needs and expectations of today’s digital consumers requires new tools.

Community banks need analytical tools for interrogating their own proprietary data as well as data from third-party sources to create improved customer experiences.

Staff Contacts: Deborah Matthews Phillips and Joel Williquette

Resource Guide

Core Processor Resource Guide

A community bank’s core processor should be a strategic partner that supports the bank’s long-term business objectives.

The ICBA Core Processor Resource Guide will help community banks with some of the more important aspects of managing this relationship to maximize the return on their technology investments.

FREE for members

Staff Contacts

Joel Williquette

Senior Vice President, Operational Risk Policy

Washington, DC