Industry Insight

The data highlights a gap between institutions’ commercial growth goals and the technology foundations needed to support them. Nearly half of respondents (49%) say technology limitations or integration gaps are the biggest barrier to growing commercial portfolios, a signal that many institutions are still constrained by legacy systems and fragmented tech stacks. For many institutions, these limitations are most visible in customer-facing capabilities that require speed, automation and real-time data exchange, such as real-time payments, which are increasingly critical to winning and retaining commercial relationships. Experts note that mergers and acquisitions—accelerating in recent years—can compound these challenges by introducing multiple systems, inconsistent data structures and operational inefficiencies.

Many integration gaps trace back to outdated core processing platforms that can’t support modern, automated workflows, analytics or real-time payments. Institutions with flexible, open cores are better positioned to implement data-driven decision-making, automated lending workflows and advanced treasury services while still delivering their trademark personal service.

At the same time, not every institution can pursue a core conversion immediately. Many can address near-term constraints by modernizing digital banking platforms that integrate with existing cores, enabling improving front-end account holder experiences as a first step toward broader transformation. Ultimately, technology modernization should be seen as a strategy to enhance—not replace—human connections.

These themes are especially pronounced for mid-sized institutions ($500M–$4.9B), which were most likely to cite technology limitations as their top obstacle, while institutions over $5B more often pointed to regulatory burden and fintech competition as primary constraints.