I've written a number of times in this publication about the critical importance of third-party integration to the core. Perhaps to no one's surprise, the need and desire by credit unions to easily integrate third-party applications to their core platforms has increased exponentially since I last addressed this topic in 2008.
Back then, third-party integration was a significant challenge for many credit unions, so much so that it wasn't unusual to see a credit union adopt its core processor's offerings simply in pursuit of the path of least resistance. Today, technology has relieved that burden somewhat. Standardized approaches to integration, such as XML and web services, have come a long way towards reducing the need for the "one-off" handling of such projects. This, in turn, has made it easier for more credit unions to choose the products they want, rather than the ones that are easiest to deploy.
Recently, some folks from the CUNA Technology Council, led in part by Jeff Johnson at Baxter Credit Union, have pushed the envelope even further with the CUFX initiative. CUFX builds on the web services concept by creating specific standards for integration to which both third-party vendors and core processors can adhere. The ultimate goal is to create a CUFX standard for every service a credit union might want to integrate. PFM integration, piloted by Baxter, is the first standard out of the gate, and a CUFX standard for online membership application is in development.
Where Responsibility Lies
As much as these evolving standards have done to simplify the integration process, the responsibility for a truly successful integration project still rests on the shoulders of the core processor. Without the sincere, dedicated commitment of the core vendor, a credit union is destined to expend more resources than necessary on the project, and ultimately impede its time to market for whatever product it's deploying.
When it comes to third-party integration, I believe that every credit union has the right to expect three things from its core vendor. The first, of course, is an open core platform that provides the necessary tools to make short work of these projects. It's important to note, however, that this is a moving target. For example, a system that may have seemed open two years ago won't be nearly as useful tomorrow if the core provider hasn't willingly adopted and embraced CUFX. This is where the industry is headed, and any vendor, core or otherwise, that doesn't see this is destined to be marginalized in the months and years ahead.
As I've said a number of times in the past, there's a big difference between a core vendor handing a credit union some tools and saying, "Have at it," and that core vendor actually promoting and encouraging third-party integration among its customers. The second contribution that a credit union should reasonably expect from its core vendor is for that vendor to work on integration projects directly with any suppliers the credit union chooses.
Simply Not Acceptable
Often, in an apparent attempt to discourage third-party integration, some core vendors force the credit union to play middleman in these projects. Integrations that should have taken weeks instead take months as the credit union relays questions and information back and forth between the core and third-party vendors. In today's marketplace, when time to market is so critical, this simply is not acceptable.
Finally, a credit union should expect its core vendor to bring a high degree of experience to the table. As an example, at last count, Symitar had integrated more than 1,800 unique products to its Episys platform. This level of experience can benefit the credit union in a number ways. If your core vendor has integrated hundreds of products, there's a good chance they've already worked with the product your credit union wants to deploy. And even if they haven't, the experience integrating similar third-party products will most certainly reduce the project time line to its absolute minimum.
When it comes to third-party integration, the rules for core processors are simple:
Provide the tools.
Provide the support.
Provide the experience.
That's the least any credit union deserves.
John San Filippo is marketing manager with Symitar, San Diego. For info: www.symitar.com