How Core Banking will Evolve Across the Middle East

Velmie CTO Sasha Kukareko discusses the technology priorities shaping the region’s banking market and the role of long-term delivery partners in modernisation programmes

Core banking is returning to the strategic agenda of established financial institutions across the Middle East. Banks have already invested heavily in mobile applications, digital onboarding and faster payments. Attention is now moving to the technology behind those services: the ledger, product architecture, integration layer and operational systems used to run the business.

We spoke with Sasha Kukareko, Chief Technology Officer at Velmie, about the direction of the market and how institutions can modernise without disrupting critical operations.

What is Driving Renewed Investment in Core Banking?

Sasha Kukareko: Many banks have improved the customer experience without materially changing the systems underneath it. That approach delivered faster results and avoided the risks associated with replacing critical infrastructure. Over time, however, it created a more complicated technology estate. Product changes still require work across several systems, integrations are expensive to maintain and operations teams often rely on separate tools to understand a single transaction.

Open finance and real-time payments will place further demands on that architecture. Banks will need to work with more external providers and make selected services available to partners, while retaining control of customer data and the financial record.

The market is therefore moving towards platforms that make change easier without weakening the systems responsible for accounting and operational control.

Do Banks Need to Replace Their Existing Cores?

Kukareko: It depends on the condition of the current platform and what the institution is trying to achieve. Some cores remain dependable as systems of record but are difficult to extend. In those cases, a full replacement may introduce more disruption than the business can justify. A bank can retain the existing ledger and introduce a modern layer for product configuration, integrations and digital services.

Other institutions have reached the point where the core itself is the constraint. The account model may no longer fit the business, operational risk may be increasing or the platform may be too expensive to support. A replacement programme then becomes necessary.

Velmie supports both approaches. Our platform can operate as the primary banking system or sit above an existing core. We begin with the institution’s operating model and technology estate rather than assuming that every programme should follow the same route.

How will Open Finance Change Banking Architecture?

Kukareko: It will make integration capacity much more important. Banks will distribute products through fintech platforms, corporate systems and other third-party channels. They will also use more specialist services within their own propositions.

Publishing APIs is only part of the work. The bank still needs to control access, manage consent and make sure that requests from external parties are handled consistently across its systems.

Many institutions have accumulated point-to-point integrations over time. That model becomes difficult to manage when every new partnership requires a separate technical connection and a different support arrangement.

Velmie provides an API and orchestration layer between the core, customer channels and external providers. It creates a consistent way to introduce new services and gives the institution a clearer view of how those connections are governed.

Our role also includes the delivery around the interfaces: transaction logic, error handling, testing and support once the service is in production.

What will Banks Expect from Technology Partners?

Kukareko: Banks are becoming less interested in buying isolated components. They need partners that understand how the core, payment infrastructure, card processing, compliance systems and customer channels fit together. A design decision in one area often has consequences elsewhere in the operation.

Institutions also want continuity. The team that implements the platform should remain involved as providers update their services, regulations change and the product roadmap develops.

Velmie combines the banking platform, operational back office, digital channels and systems integration within one delivery organisation. We work with payment networks, card processors, KYC and AML providers and reporting systems selected by the client.

The engagement continues after launch through maintenance, integration changes and further platform development. That retained knowledge is particularly important in a regulated environment, where even a relatively contained change can affect several parts of the service.

How will Artificial Intelligence Influence the Core Platform?

Kukareko: The immediate opportunity is in banking operations. AI can support transaction investigations, organise service cases and bring together information that employees currently collect from several systems. It may also assist with routine decisions where the institution has defined clear limits and approval rules.

The quality of the outcome will depend on the data available to the model.

A bank cannot expect reliable automation when customer information, ledger entries and provider responses use inconsistent references or sit in disconnected systems. Before introducing AI into sensitive processes, the institution needs accurate records, clear ownership of data and controlled access to operational functions.

Velmie is developing its platform around that principle. The core remains responsible for the financial record, while automation can use governed interfaces to support employees and coordinate approved actions.

AI will be most useful where it builds on a sound operating model. It will not compensate for a fragmented architecture.

What will Distinguish Successful Banking Platforms Over the Next Five Years?

Kukareko: Banks will expect stability and adaptability from the same platform. The ledger must remain dependable, but the institution should not need a major development programme every time it introduces a product, changes a provider or enters another market.

Regional banks also need to accommodate differences between jurisdictions. Payment infrastructure, regulatory controls and reporting requirements vary across the Middle East, even where the customer proposition is broadly similar.

Velmie provides a common technology foundation that can be configured for different legal entities, product structures and local providers. This allows a banking group to retain consistency without forcing every market into an identical model.

Core modernisation will increasingly become a continuous process rather than a single replacement project. Institutions will update parts of the architecture as business priorities change, while protecting the stability of the live operation.

Velmie’s role is to support that process over time: providing the platform where required, integrating the surrounding systems and remaining accountable as the institution develops.