Stanbic Holdings Plc, Kenya’s sixth-largest bank with a market capitalisation of KES 49.14 billion ($381 million), has finalised an upgrade of its core banking application, Temenos 24 (T24 R23).
Last week, the bank informed its over 266,000 customers of service disruption across its banking channels between October 19 and 21 due to the upgrade. On October 23, five customers told TechCabal they couldn’t access their accounts or make transfers after the said deadline.
Temenos 24 is used by over 950 banks worldwide, including Kenya Commercial Bank (KCB), mainly for retail, business, corporate, and wealth management. The application, owned by Swiss company Temenos, was upgraded in partnership with US-based Orion Innovation, a digital transformation specialist, Stanbic said.
“We have upgraded from T24 R17 to T24 R23. R23 is the latest release, and we are among the first banks to upgrade globally,” Stanbic told TechCabal in a statement.
While the current upgrade has been the most impactful with robust security features, Stanbic began upgrading its core banking platform in early 2024, two banking executives told TechCabal. Temenos was upgraded to version R17 in May 2024, adding cloud-based digital banking features.
“We continue to monitor the system for any incidences and to ensure that it’s performing at an optimal level,” the bank said.
The disruptions show the complexity of upgrading core banking systems, which has forced Kenyan banks to invest in new talent to address technical issues. In 2023, NCBA, a tier-1 bank with a market cap of KES 72.9 billion ($565 million), increased its IT staff costs by 30% as competition for talent among banks, telcos, and big tech corporations heats up. Equity Bank also reported that its staff costs had gone up by 32% after sinking in more resources in the tech departments.
“Kenyan banks are aggressively hiring techies and data scientists,” one mid-level bank executive who asked not to be named told TechCabal.
Developing an in-house core banking platform allows banks to have greater control over customisation and data security, a manager at a rival bank told TechCabal. However, it can also be costly and cumbersome, the same manager said, so banks, like Stanbic, choose to outsource core applications for access to expertise and cost efficiency.
“Integrations are complex due to the outdated technologies of many banks. There are also cases of managing multiple stakeholders in a bank whose differing priorities can delay upgrades,” a bank manager told TechCabal.
