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Temenos to offer low-cost banking software

NAIROBI, Kenya, Oct 31 – Banking software company Temenos has moved its banking system solutions to the Microsoft Windows Azure cloud platform, as it seeks to lower the cost of its products and make it readily available for smaller players.

Temenos Director of Community Banking Murray Gardiner said on Monday that having the core banking systems on the cloud, would reduce operational costs in installing the systems in banks, making it available to more micro finance institutions and Saccos to offer financial services.

“Cloud services are an important part of providing banking solutions. We are now able to open a core banking system to even the low tier banks because it is more efficient and cost effective for them to run,” Gardiner said.

Gardiner said micro finance institutions were lagging behind in their use of modern IT systems, slowing down their role of providing financial help to those without bank accounts.

Unlike commercial banks, which are racing into new technology such as mobile banking and improving their software systems to boost efficiency and accuracy, increasing outreach, and reducing costs, microfinance institutions have been slow to adopt technology.

“For someone to get any of our systems for less than $500,000 (Sh47 million) will be remarkable and you find that most small banking institutions will settle for something that costs less but not of good quality,” the Temenos boss argued.

Once microfinance institution or a Sacco takes up the banking system, Temenos will work out a pay-as-you-use structure so that they are able to pay for what they use.

Recent research conducted by Temenos showed that one in two microfinance institutions regard IT virtualisation as a top investment priority in 2011, demonstrating not only demand for cloud based technology but also an increased awareness of the many benefits it can bring to these organizations.

Over the last 12 months, Temenos and Microsoft have made significant investments in the systems to ensure it runs natively on Windows Azure.

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“By doing so, we are allowing these institutions in emerging markets to remove the high costs associated with running a multi-application environment on premise by moving these operations to a consumption based pricing model.

As a result, these institutions can benefit from increased productivity and profitability through an improved total cost of ownership and uniform operational environment,” he said.

In Kenya, Temenos provides core banking solutions for Kenya Commercial Bank, CfC Stanbic bank, Credit bank and the Central Bank of Kenya. It also provides banking solutions for Kenya Women Finance Trust and church-run Small and Medium Enterprise Program.

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