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You can't wait for customers to "die out" as their mortgages will go on for decades. You definitely need a customer's old data in the new system. Now you have t
by UweSchmidt 10y ago
You can't wait for customers to "die out" as their mortgages will go on for decades. You definitely need a customer's old data in the new system. Now you have to maintain and develop two systems - bugs, banking regulation require constant work. Often the clock is ticking for old systems and asking vendors to provide and maintain ancient tools can be expensive or impossible. You can't "manually" move customers over, you need to "migrate" lots and lots of data - both systems will have huge, completely different database schemas.
- joncrocks 10y agoWhile mortgages do go on for decades (typically), people will frequently re-mortgage based on new interest rates. e.g. in the UK it's typical to sign up for 2-10 year deals, with the interest increasing after these offer periods, meaning people will likely switch to another deal. So there will be a certain amount or organic churn.
- twic 10y agoNot enough churn, though. I worked on mortgages for a UK high street bank a while ago, and they were still running the mortgage systems for every bank and building society they'd taken over in their decades of growth, plus a few different attempts at building one system to rule them all.
- sedachv 10y agoFor an example of how this system switchover looks like, First Bank in the United States just did a whole-system switchover in March, at least for their business customers. They handle my wife's business' banking, which means I do all the paperwork, and it definitely was a pain. Basically it was like signing up for a whole new bank account. They copied over something like only the last 6 months of transactions and some payroll info, but things like automatic bill payments and everything else (even basic online login) had to be set up again.