Manual changes: Banks running legacy, closed-box systems struggle to make automated changes to products or accounts en masse. To change one term across many accounts, such as changing interest rates or fees, the bank would rely on the vendor to make those changes manually. This is expensive and time-consuming. Banks, on occasion, have been forced to shut down entire product lines because they have failed to adjust terms in accordance with new regulation.

Vendor dependency: Legacy software vendors typically maintain the software’s entire codebase and provide switches to turn a limited set of features on or off. The vendor is responsible for core and product systems (credit card, CASA, loans, and so on). The underlying product code is unavailable to the bank, so it must rely on the vendor to change existing products or configure new ones.

Service reliability: With a legacy system, many of its services are tightly coupled and depend on one another. This means that a small change in one area of the system, be they scheduled or reactive, could impact a large part – or even all of – the service.

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