Can Banks’ Relationship With FIS, Fiserv, And Jack Henry Be Fixed? (2023)


The “Big 3” in bank technology—FIS, Fiserv, and Jack Henry—dominate the market for core banking systems and provide many of the ancillary and functional systems that banks and credit unions run.

Talking to bankers about their technology provider relationships elicits a range of emotions. In Cornerstone Advisors’ What’s Going On in Banking 2021 report, half of bankers said that getting more value from their technology vendor relationships is a top technology priority.

American Banker quoted one bank CEO who said:

“The biggest threat to banking innovation is the legacy cores. I want the bank to be here another a hundred years, and it just was not happening under any legacy core.”

What’s the problem? According to Cornerstone, bankers are most frustrated with the core providers’ speed to market and pace of new innovations, followed by difficulties integrating third-party systems to the core applications.

In addition, bankers are split on whether or not their core provider contributes to their organization’s digital transformation efforts.

Don’t cry for the vendors, Argentina.

A comparison of the five-year stock performance of the Big 3 to the KBW and QABA indices (both benchmark stock indices of the banking sector) shows that the tech providers have delivered higher and more stable stock price growth than banks.

The View From The Big 3’s C-Suite

What do the core providers think about all of this and the challenges facing banks and credit unions—and their own businesses?

To get their perspective, I spoke to David Foss, CEO of Jack Henry & Associates, Bruce Lowthers, President of FIS, and Byron Vielehr, Fiserv’s Chief Digital and Data Officer.

1) How Can Banks Stay Relevant?

I asked each of the execs about their perspective on what banks and credit unions need to do to remain relevant in the market today—and what their companies are doing to help financial institutions do those things.

Bruce Lowthers, FIS: “Financial institutions need to do three things: 1) improve the customer experience; 2) modernize their infrastructure; and 3) innovate to make it better for the next generation of customers.

To help them do this, FIS invested six years ago in a private cloud, converted apps to take advantage of the cloud, and modernized our infrastructure and network capabilities. In addition, we’ll bring close to 100 products to market this year, and will double our revenue from new products.”

Byron Vielehr, Fiserv: “The key to banks and credit unions staying relevant is helping people solve problems in their financial lives. For example, payments is becoming a bigger part of people’s financial lives. It’s more than just account balances.

P2P (person-to-person) payments are important, interactions need to be more intuitive with less friction. We’ve turned Zelle on for 500 financial institutions, and will have more running on Zelle than the rest of the industry. We’re also offering a new digital card hub that abstracts features and functionality around the core.”

David Foss, JHA: “Financial institutions’ challenge is creating experiences for customers that are different—but that requires them to think differently. They need to create partnerships to engage customers in new ways and create connectivity between partners. The problem is that bankers aren’t thinking that way.

Jack Henry is building out that middleware/API layer and providing a digital layer on top to create that ecosystem. The key part is built around Banno—it’s not just a digital banking layer, but a way to translate service differentiation to the digital channels.”

2) How are Core Vendors Addressing Speed to Market?

A common criticism from banks is that the major vendors move too slow. I asked the execs how they feel about that and what they’re doing to address speed to market.

Lowthers, FIS: “Innovation is a funny thing—if we don't create what you’re looking for, then we’re not viewed as an innovator. But we’ve been recognized by Fast Company as a top innovator and we’re playing at a speed at which we've never moved before. We’ve changed our infrastructure and our platform in order to focus on speed. We’re releasing 50 new products per year. And we’re driving toward becoming a world-class collaborator—few companies do that.”

Vielehr, Fiserv: “We focus on speed all the time—but sometimes clients aren't ready to run. We pre-build as much as possible. Our API ecosystem enables clients to cut out the tight link to the core port data to the cloud to provide more flexibility.”

Foss, JHA: “It’s popular to say that the big core providers are slow and monolithic, but sometimes fast is the enemy of right. We focus on areas where we need to be quick, e.g., Zelle integration. Our competition did point-to-point integration, when the right thing to was integrate with other RTP rails. We created a more robust PayCenter, eliminating multiple integration efforts.”

3) What are the Threats to the Core Providers’ Business?

Banks may face existential questions about their future relevance to their customer base, but what about the core vendors? What threats do they see to their business?

Lowthers, FIS: “The technology provider landscape is always highly competitive. The big dynamic in the market is that startup funding has fundamentally changed. A startup used to get excited with a $30 million raise—now they’re raising $500 to $600 million. There’s a benefit from this to us, however, because it expands our total addressable market as many startups become clients and partners along the way.”

Vielehr, Fiserv: “The two biggest threats to our business are a non-healthy banking ecosystem and small-to-medium businesses and merchants pivoting to digital. We need to focus on making sure they have all tools needed to make this move. We don't see anyone coming in to provide a full suite of solutions, however.”

Foss, JHA: “Well, what we’re not worried about is FIS and Fiserv—they’re not doing anything more innovative than we are. The threat we worry about is: Who will really disintermediate banks?”

Downplaying the Threats?

While the Big 3 are rightfully concerned about the health of the banking system, they may be downplaying other potential threats on the horizon.

Googles’ recent pullback out of the checking account market might diminish that Big Tech’s firm threat as a bank tech provider, but I’ve long believed that Google wants to be a tech vendor to banks.

In addition to Google, at some point Amazon could get into the picture and create a marketplace for checking accounts. Why would it do that? Because it could make a lot of money charging banks for account opening processing taking advantage of its ability to do identity verification, and then potentially offer account processing services via an acquisition or two.

And none of the execs mentioned Square, Shopify, or Stripe as potential threats. Square, in particular, should be seen as a threat to both banks and the core providers as their payment processing and small business banking and lending businesses grow.

The execs’ defense—”we don't see anyone coming in to provide a full suite of solutions”—overlooks two points:

  1. The same thing that is happening to banks—i.e., fintechs like Square and challengers banks are cherry-picking customers away—could happen to the core providers, thanks to new integration platforms.
  2. Not all financial institutions don’t want a provider with a”full suite of solutions”—they want a balance between best-of-breed and not having to manage a thousand vendors.

Bridging the Perception Gaps

There’s a clear divergence of perceptions: Financial institutions are frustrated with the core providers’ pace of innovation, but the technology providers counter that with examples of their innovative progress.

Why the divergence? According to Steve Williams, President of Cornerstone Advisors:

“The differing perceptions stem from the fact that institutions below $50 billion in assets aren’t really positioned to ‘go it alone’ and merely consume technology from big players. As the core providers have grown, it feels like there is less ‘roll up the sleeves’ time between banks and vendors dealing with thorny issues of execution.

Williams points out, however, that these efforts aren’t as profitable for the providers as rolling up a new tech acquisition with leverage and cutting costs.

Banks aren’t off the hook here, however. The three execs have a point when they call out banks for “not always being ready to run,” discounting the innovations delivered, and not “thinking differently.”

The root of the problem and frustrations is misaligned interests. Williams suggests:

“The core providers should create a ‘service/execution ecosystem’ that can grow profitably around their solutions when they don’t have the financial flexibility to invest in the transformation and executive assistance needed by smaller institutions.”

JHAs’ Foss and I spoke about opportunities for the cores to provide consultative type services, but he pointed to the financial institutions’ reluctance to get these kind of services from them.

Looking Ahead

The strategic positioning of FIS, Fiserv, and Jack Henry reads like a business school case study—they enjoy strong barriers to entry from competitors and benefit from huge (and painful) switching costs. Congrats to them for achieving that.

To be fair, not all banks and credit unions are dissatisfied with their core provider. But many are, and it isn’t desirable to have strained relationships with your client base.

Both parties in the equation—the core providers and financial institutions—need to make changes to improve these relationships.

Banks have had to learn that consumers are less and less likely to consolidate all of their accounts with one bank. The cores may need to learn to thrive in an environment where they don’t provide all of a bank’s systems.

In Memoriam

Speaking of bank technology providers, the industry lost a giant last week with the passing of MX co-founder and Chief Technology Officer Brandon Dewitt, who lost his five-year battle with cancer. That the battle was only expected to last three months is testament to Brandon’s strength, perseverance, and ingenuity during his treatment.

Jason Henrichs, President of Alloy Labs, tweeted about the “hole in the moral fabric of fintech” that Brandon’s passing created and that now needs to be filled.

Brandon personified “purpose-driven.” In a recent episode of the Breaking Banks podcast, Brandon commented:

“With this new layer of technology you bring in this idea that technology has been optimizing and automating everything out there. There’s now a new layer of stewardship. Like how does that play into our communities? How do we set the right priorities and have the right types of purposes behind that? You have to decide: Are you going to be a builder and executor, or will you be a handshake entrepreneur?”

RIP, Brandon Dewitt.


Why do banks use Fiserv? ›

A Fiserv partnership provides comprehensive and integrated banking solutions that address every aspect of your performance and growth concerns. You gain: Industry-leading technology that helps you keep pace with growing expectations. Access to a wealth of banking expertise to help you plan for the future.

Could FIS Fiserv benefit from credit legislation? ›

Legislation aimed at creating competition for card giants Visa and Mastercard could be a boon for payments companies FIS and Fiserv. Payments processing giants Fiserv and FIS stand to benefit if legislation aimed at fostering more competition in the routing of credit card transactions passes Congress.

Are FIS and Fiserv different companies? ›

Fiserv Inc. (NASDAQ:FISV) and Fidelity National Information Services (NYSE:FIS) are leading financial service technology providers. At the of heart of it, both companies' business models specialize in providing core banking processing solutions to financial institutions to conduct their day-to-day operations.

Which bank has partnered with Fiserv? ›

Community Bank of the Bay and Fiserv Bring Real-Time Payments to the Bay Area - Fiserv, Inc.

Is Fiserv considered a bank? ›

Company timeline including acquisitions. Citicorp Information Resources — a subsidiary of Citicorp. This acquisition put Fiserv into the commercial banking, internal and credit union core account processing market space.

Does Chase bank use Fiserv? ›

Top money center banks like JPMorgan Chase (NYSE: JPM), Wells Fargo (NYSE: WFC), and Citigroup (NYSE: C) have been Fiserv customers for over three decades and its acquisition of First Data puts Fiserv at the core of 90% of the banking systems.

What bank uses FIS? ›

Citizens Access. With the help of FIS, Citizens Bank built and launched one of the fastest-growing direct banks in the country, attracting $1 billion in new deposits every quarter.

Is FIS a core banking system? ›

A Core System to Meet Financial Institutions of all Sizes.

FIS empowers community, mid-tier, large and global financial institutions to meet those customer needs, contend with regulatory pressures, and effectively compete with alternative providers.

What are the challenges of FIS? ›

Challenges Facing FIs in Serving Their Small Business Customers
  • The battle for the small business customer. ...
  • Market identification and promotion. ...
  • One size doesn't fit all. ...
  • Scalable investment and charging for value. ...
  • Time to value, speed, and convenience comprise the new loyalty.
May 20, 2020

Who is FIS biggest competitor? ›

Competitors and Alternatives to FIS
  • Fiserv.
  • Oracle.
  • Intellect Design Arena.
  • Jack Henry & Associates.
  • EdgeVerve.
  • Tata Consultancy Services (TCS)
  • Finastra.
  • SAP.

What is the difference between FIS and banks? ›

Major sources of funds of FIs are Term Deposit (at least three months tenure), Credit Facility from Banks and other FIs, Call Money as well as Bond and Securitization. The major difference between banks and FIs are as follows: FIs cannot issue cheques, pay-orders or demand drafts.

What banks use Jack Henry? ›

Apply Filters For Customers
Century BankBanking and Financial ServicesUnited States
Citizens Bank of EdmondBanking and Financial ServicesUnited States
City BankBanking and Financial ServicesUnited States
SubscribeBanking and Financial ServicesUnited States
6 more rows

Is Zelle a Fiserv product? ›

Fiserv has launched nearly 70 percent of all financial institutions that are live on the Zelle Network®.

How many banks does Fiserv work with? ›

Its pop-money person to person payments is offered by around 2,200 banks and more.
Companies that use Fiserv Premier.
Company NameBurroughs, Inc.
Contact Info(734) 737-4000
Revenue$129 Million
4 more columns

Does Zelle use Fiserv? ›

Fiserv offers Turnkey Service for Zelle® to simplify your path to implementing a ubiquitous, frictionless P2P solution. Faster processing lets your accountholders deliver and receive payments in real-time across the most efficient delivery method.

Is FIS or Fiserv bigger? ›

FIS's brand is ranked #- in the list of Global Top 1000 Brands, as rated by customers of FIS. Their current market cap is $88.84B. Fiserv's brand is ranked #319 in the list of Global Top 1000 Brands, as rated by customers of Fiserv. Their current market cap is $74.66B.

Is Fiserv affiliated with Bank of America? ›

We are excited for the next phase of our relationship with Bank of America, and are committed to continuing to provide market-leading products and services to the bank and its clients,” said Guy Chiarello, chief administrative officer of Fiserv.

What are the big 3 core banking platforms? ›

The “Big 3” in bank technology—FIS, Fiserv, and Jack Henry—dominate the market for core banking systems and provide many of the ancillary and functional systems that banks and credit unions run.

Does Wells Fargo use Fiserv? ›

Wells Fargo Merchant Services Overview

Wells Fargo uses Fiserv (formerly First Data) as its back-end processor, allowing it to market the popular Clover lineup of POS systems and terminals. However, it also means that you may have to deal with Fiserv for some issues, including account holds, freezes, or terminations.

Does Walmart use Fiserv? ›

Walmart also already offers options for customers to pay their bills through the store online with some 15,000 billers. Those fees also vary. That online service is powered by long-time payments industry processors, Fiserv, through its CheckFreePay service, and Moneygram.

How many banks and credit unions use Fiserv? ›

In 2021, 234 credit unions chose Fiserv as their core solution provider. “Our market position is differentiated by the breadth of our offerings and the depth of our expertise.

Who owns FIS? ›

The company was founded in 1968 as Systematics™, which was later acquired by ALLTEL Information Services, and then bought by title insurance giant Fidelity National Financial® in 2003, who renamed it Fidelity Information Services (FIS).

How many bank clients does FIS have? ›

We are passionate about helping businesses and communities thrive by advancing the way the world pays, banks and invests, serving more than 20,000 clients and more than one million merchant locations in over 130 countries.

What does FIS mean on my bank account? ›

Fidelity National Information Services (FIS)

Is FIS any good? ›

Is FIS a good company to work for? FIS has an overall rating of 3.7 out of 5, based on over 10,711 reviews left anonymously by employees. 69% of employees would recommend working at FIS to a friend and 59% have a positive outlook for the business. This rating has decreased by -2% over the last 12 months.

How many FIS are there in the US? ›

Yet it's not uncommon to hear that there are nearly 18,000 financial institutions in the United States.

Is FIS a payment processor? ›

Accept Payments Easily With A Payment Gateway

Worldpay from FIS is a global leader in payment processing with expertise as a payment gateway provider in the UK.

What are the three values of FIS? ›

It's about fairness, equal opportunity, respect and trust. Inclusion is embedded in FIS' core values and in our views on corporate responsibility. At FIS, we believe fostering and cultivating an inclusive and diverse workforce is the responsibility of all our employees.

Why FIS stocks are going down? ›

A downtrend has been apparent in Fidelity National Information Services (FIS) lately with too much selling pressure. The stock has declined 10.2% over the past four weeks.

What are the primary functions of FIS? ›

The primary functions of FIS include: Recording of all financial transactions in general ledger accounts. Generating financial reports to meet management and statutory requirements. Controlling overall spending through budgetary controls embedded in the system.

Is FIS better than Deloitte? ›

Deloitte scored higher in 9 areas: Overall Rating, Culture & Values, Diversity and Inclusion, Senior Management, Compensation & Benefits, Career Opportunities, CEO Approval, Recommend to a friend and Positive Business Outlook. FIS scored higher in 1 area: Work-life balance.

Is FIS a Fortune 500 company? ›

The S&P 500 list includes Palmer because Regency is one of the stocks in that index. Regency is not a Fortune 500 company, which measures the largest U.S. companies by annual revenue. FIS is in both the Fortune 500 and S&P 500.

Is FIS a fortune? ›

FIS, a global corporation for financial products and services, opened its new headquarters Wednesday in Jacksonville. While in the region, FIS has grown as a Fortune 500 company with nearly $14 billion in annual revenue, said Lauren Pozmanter, FIS marketing and communications manager.

What is the safest bank in the US? ›

5 Safest Banks in the U.S.
JP Morgan Chase$3.2 trillion
Bank of America$2.42 trillion
Citi$1.77 trillion
Wells Fargo$1.72 trillion
1 more row
May 1, 2023

Which bank is least likely to go bust? ›

JPMorgan Chase (JPM) The inclusion of JPMorgan Chase (NYSE:JPM) as one of the bank stocks least likely to fail shouldn't surprise anyone. That's not to say it didn't suffer from the sector fallout because it did.

Is FIS an investment bank? ›

Investment Banking & Brokerage Solutions | FIS. Provide a banking experience that puts your members' needs first. Drive your digital services forward with our best-in-class solutions. Find a tailored approach to modernization that suits your needs now and later.

How many banks does Jack Henry support? ›

Jack Henry Banking is a provider of integrated computer systems for banks ranging from de novo to institutions. Jack Henry Banking currently serves approximately 1,000 banks.

Who are Jack Henry's competitors? ›

The top three of Jack Henry Banking SilverLake's competitors in the Banking category are Razorpay with 27.98%, Oracle Financial Services with 14.87%, Temenos with 8.97% market share.

Is Jack Henry a Fintech company? ›

Jack Henry Named a 2021 Best Fintech to Work for by American Banker.

Which bank owns Zelle? ›

Zelle (/zɛl/) is a United States–based digital payments network run by a private financial services company owned by the banks Bank of America, Truist, Capital One, JPMorgan Chase, PNC Bank, U.S. Bank, and Wells Fargo.

Does Citibank use Fiserv? ›

Citi Financial uses Weiland BRMedge™ from Fiserv to automate bank fee analysis and better manage its commercial banking relationships.

Does PayPal use Fiserv? ›

Businesses Can Deliver Branded Digital Payouts to PayPal and Venmo Accounts via Carat from Fiserv - Fiserv, Inc.

Does PNC own Fiserv? ›

A Proven Team: PNC Merchant Services is an alliance between PNC Bank — one of the nation's foremost financial services providers — and Fiserv™, a global leader in payment processing solutions.

Did Fiserv lose a big customer? ›

Payments processing company Fiserv told analysts during a conference call Wednesday that it lost a “large processing client” during the third quarter, but downplayed the revenue impact.

Does MasterCard use Fiserv? ›

Fiserv offers several Visa® and MasterCard® debit and credit card designs as part of The Card Collection. All are preapproved and created specifically for EMV chip cards.

Who cannot use Zelle? ›

You must have a bank account in the U.S. (not including U.S. Territories) and a U.S. mobile phone number to use the Zelle® app. U.S. Territories include American Samoa, Guam, Northern Mariana Islands, Puerto Rico, and the U.S. Virgin Islands.

Who is the processor for Zelle? ›

Real-time payments

Utilize the FIS PayNet Network for real-time debit and credit processes.

Is Zelle connected to a bank? ›

If your bank or credit union offers Zelle® - You can send money to people you know and trust with a bank account in the U.S. If your bank or credit union does NOT offer Zelle®- The person you want to send money to, or receive money from, must have access to Zelle® through their bank or credit union.

Why are employees leaving Fiserv? ›

The payments processor cut employees in the first half of the year and shouldered higher severance expenses, following a string of acquisitions in recent years. The worldwide payments processor Fiserv cut its workforce in recent months as its profit margin came under pressure from a worsening economic climate.

What is Fiserv known for? ›

Today, we are a global leader in payments and fintech, serving thousands of financial institutions and millions of businesses in more than 100 countries.

Is Fiserv in trouble? ›

Based on the latest financial disclosure, Fiserv Inc has a Probability Of Bankruptcy of 23.0%.

Is Fiserv laying off people? ›

Fiserv reported having over 41,000 employees at the end of 2022, down from more than 44,000 at the end of 2021.

What company is similar to Fiserv? ›

Competitors and Alternatives to Fiserv
  • Jack Henry & Associates.
  • FIS.
  • Oracle.
  • Finastra.
  • ICS Financial Systems.
  • SAP.
  • Temenos.
  • Automated Systems.


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