Baxter Credit Union (BCU)

Breaks new ground by taking Temenos to the cloud

Vernon Hills, USA

At a Glance

● Offers exceptional levels of security to account holders

● Provides up-to-date digital banking capabilities

● Increases cost-efficiency; employees spend less time and resources managing IT infrastructure in the data center

● Scale its digital banking infrastructure quickly and easily in line with rising member volumes

Baxter Credit Union (BCU) strives to find innovative ways to improve the financial well-being of 320,630 members across the United States and Puerto Rico. This could mean introducing personalized services that help members manage their finances more proactively, providing faster access to key lending products, or offering a more intuitive online experience. All in all, BCU places a premium on continuous improvement.

Jim Block, Executive Vice President & Chief Operating Officer at Baxter Credit Union explains: “Across our business lines, we are always planning ahead and thinking not only about how we can meet evolving member requirements but also how we can get a step ahead of the curve. To achieve this, we naturally forge close links with our network of technology partners to ensure we have access to the most advanced digital capabilities.”

In 2016, Baxter Credit Union (BCU) faced the need to upgrade from version 10.31.20 to version 15.01.47 of Temenos digital banking, spanning the Collection, Loan Origination, and Service modules. The project alone was already considered a major upgrade, as it encompassed launching the $2.8 billion credit union on Temenos’ most recent “person-centric” technology, a panoramic view of account holder relationships. BCU took it one step further and asked to do what had never been done: take the Temenos collection, loan origination, and service to the Cloud.

We are planning double-digit growth across key areas, which means we need to have the ability to scale our technology to meet growing demands. This scalability takes out the uncertainty in our planning, and ensures that our investments are targeted and consistent. When looking at a major upgrade with Temenos digital banking, we knew that as part of that project we wanted to move hosting into Microsoft Azure.”
Scott Zulpo, CTO at Baxter Credit Union

Situation

BCU’s decision to move to the cloud crests the wave of financial institutions that have begun to examine moving to hosted environments. Historically, the cloud has been viewed with apprehension and distrust by the financial services industry. In the United States specifically, following the wave of security breaches across retail store chains, hospitality organizations, and even the United States government itself, concerns surrounding cybersecurity are at an all-time high, reflected in heavy government regulation. The first task for BCU, Microsoft, and Temenos was to ensure security.

“Temenos handles a large amount of account holder data. Combined with the fact that this was the first time these modules were being implemented in the cloud, we knew we needed to undergo rigorous testing to ensure that not only was everything functioning properly in an all-new environment, but also that it was secure.” – Temenos Executive explains.

US-based BCU wanted to decrease costs while increasing scalability and speed-to-market. In 2017, they became the first Temenos customer to take the Temenos Collection, Loan Origination, and Service into the Cloud

While some organizations might view being an “inaugural customer” as a risk, BCU instead saw the chance to pull ahead of its contemporaries. Additionally, they saw the benefit of moving away from maintaining data centers and reducing IT overhead, which would allow them to focus less on managing systems and concentrate on offering first-class products and services.

“Over the past three years, we’ve made it a strategic objective to move into the cloud wherever the opportunity arises. Our long-term goal is to move all of our vendors into a cloud-based environment. Our vision is to centralize all of our technology so that we can implement uniform processes and skillsets across departments. We are continually investing in technology and innovating in that space. This transition will allow us to increase automation and spin up additional servers more quickly, enabling us to scale and paving the way for growth.” Jeff Johnson – CIO at BCU

Solution

The decision to move to Microsoft Azure led to extensive testing and a thorough audit of their existing processes, making BCU more secure than ever before. Using recent software delivery methodology, the testing and implementation were completed over nine months and included a multitude of checks and balances with continuous collaboration across the implementation teams. During phase one, Temenos and BCU built five environments in the cloud over roughly two months. Phase two was spent upgrading the Temenos digital banking modules to Version 15, fine-tuning processes, and testing that the functionality had not been impacted by the all-new environment. This phase involved a two-pronged approach:

Business Unit: Functional testing of the Collection, Service, and Loan Origination modules as BCU jumped four releases
IT: environment configuration testing, including firewalls and connectors.

Due to the implementation being the first of its kind, the project involved levels and aspects of security that had not been encountered in previous projects. This meant additional, in-depth testing outside standard parameters from a security perspective, as well as ensuring that the new protocols didn’t inhibit functionality within the system. BCU officially went live in March 2017, with no unplanned interruption to service. With the Temenos digital banking modules now hosted in Microsoft Azure, BCU has gained multiple layers of data protection, including data encryption, auditing, and Azure’s unique threat detection offering. Since the implementation, BCU has seen an improved ability to scale on demand, enhanced disaster recovery capabilities, and optimally sized hardware for their volume.

Any financial institution looking to take on a project of this magnitude needs to understand just that: it’s a project of immense size and difficulty. It’s a significant commitment, and the decision should certainly not be taken lightly. However, the project has undoubtedly moved us much farther ahead in our understanding of each of the technology platforms we use to drive our business lines, and also the levels of security we can offer to our account holders.”
Jeff Johnson, CIO at Baxter Credit Union

With the Temenos digital banking upgrade completed successfully, BCU has access to the latest digital banking capabilities, including open APIs, automation, and sophisticated decisioning tools. The credit union can now ingest and analyze more data about lending requests, helping to build a detailed, three-dimensional picture of applicants. As a result, BCU makes lending decisions faster, ensuring members enjoy a stronger experience.

With Temenos, we are making banking better for our members, giving them the tools and services they need to improve their financial wellness. Having a strong network of partners on hand is essential to drive change, and Temenos plays an important role in our success. We will continue to explore new roadmaps and digital strategies that help us to grow and take our offerings to the next level.”
Jim Block, Executive Vice President & Chief Operating Officer at Baxter Credit Union