Nucleus Software Pioneers Banking Tech with Lean Principles

Parag Bhise

With the adoption of Acceptance Test-Driven Development (ATDD) moving in the direction of continuous integration and eventually continuous delivery (CICD), Nucleus Software is following proven principles of lean manufacturing in software development for the banking technology sector, shared Parag Bhise, CEO of Nucleus Software, in an exclusive interaction with Srajan Agarwal of Elets News Network (ENN).

Over the last three decades, Nucleus Software has developed proprietary technologies that have significantly impacted the BFSI industry. Can you elaborate on some of the key technological milestones in this journey and how these innovations have transformed the landscape of banking and finance?

We have been on a mission for the last 30 years of translating BFSI domain expertise into innovative and comprehensive technological platforms that lead digital transformations for leading FIs globally. With our digital-first ethos at the forefront, we deliver robust and scalable solutions that redefine industry standards. Our unyielding dedication to empower financial institutions sustainably and competitively is fuelled by relentless R&D investments and rich domain expertise. At Nucleus Software, our primary objective is to deliver substantial value through innovative technological solutions, facilitating comprehensive digitisation with robust functionality, minimal downtime, and effortless scalability. We prioritise customer needs and remain committed to our core values of result orientation, integrity, innovation, respect, and collaboration. Each milestone reinforces our position as trusted partners empowering our clients to thrive in an ever-evolving landscape.

Our innovative BFSI journey started more than 3 decades ago when a multi-national bank looking to set up retail branch in India chose us as their technology partners for multiple businesses, across the length and breadth of retail banking.

The business solutions being achieved using technologies like RPA in last 7-8 years, have been achieved by Nucleus Software as early as in 1997, by enabling a leading American bank to offer 24*7 ATM solutions (unheard of in late 1990s) in spite of the bank being on mainframe technologies by leveraging Screen Scrapping Technology. We created highly innovative VRU and Credit Cards solutions enabling a leading bank to expand its footprint in India by launching personal finance services PAN India in late 90s.

In 2002-2003, we developed a sophisticated document management platform and imaging solutions that enabled leading banks in Southeast Asia and the Far East. We also assisted many of our clients in being the first in their respective regions to launch Business Intelligence and Analytics solutions when the related technologies were relatively new. We have played a pivotal role in assisting many of our clients in embarking on cloud-first business strategies.

Our recent significant milestones are the launch of FinnOne Neo®, our digital lending platform, which revolutionised the lending process and FinnAxia®, our comprehensive transaction banking suite, as well as PaySe™, our financial inclusion product that has added to paradigm shifts in the financial services sector. These innovations have transformed banking and financial services by significantly improving transaction efficiency, enhancing security, delivering personalised customer experiences and enabling greater financial accessibility, thereby setting industry benchmarks and driving the digital transformation of banking services globally.

Nucleus Software’s journey to excellence has been marked by commitment to innovation and continuous improvements through its strong products and services portfolio. Nucleus Software’s FinnOne Neo® has been a front runner in this regard as it incorporates out-of-the-box digital APIs facilitate robust, secure, easy, quick, and agile integrations. FinnOne Neo® supports cloud, hybrid and on-premise deployments and can be deployed quickly in partnership with leading cloud providers. FinnAxia®, the transaction banking platform, has been used by the leading banks worldwide for its prowess to provide a 360-degree account view, providing the visibility and control desired. Our products are developed with built-in engines that incorporate domain expertise to manage the entire business process of lending and transaction banking successfully and intuitively. Our platforms not only address current pain areas but also the future growth trajectory of our customers and the industry at large.

Nucleus Software’s latest product innovations have played a crucial role in driving the company’s expansion into new global markets. Could you provide specific examples of these innovations and explain how they have facilitated your entry and growth in these new regions?

Nucleus Software originated from Indian soil and has established standards worldwide with continuously transforming the financial services sector with its strong product offerings. We went global with the first international office setup in Singapore way back in 1994. As of 2024, Nucleus Software is servicing in over 50+ countries, providing value to over 200+ financial institutions, offering 2700+ lending variants with three major products catering to digital lending – FinnOne Neo®, transaction banking – FinnAxia®, and financial inclusion – PaySe™.

Our platforms consider what the global BFSI industry seeks in a technology partner, e.g., the highest security standards, robust business engines, rule-based workflows, seamless integration engines, easy-to-implement, intuitive interface, enhanced customer experience and more. Our global market expansions were possible with our unique proposition of offering global expertise with a localised outlook and focus for our customers across the globe. Today, we are present in India, Southeast Asia, the Far East, the Middle East, Africa, Europe, Australia, Latin America, and North America.

Our lending platform manages end-to-end life cycles from customer onboarding to delinquency management and can be easily and securely integrated with the ever-growing financial eco-system. The Loan Management System (LMS) module takes care of the entire servicing life cycle of a loan, including accounting, repayment, special Transactions, non-performing asset management, and self-service through multiple channels. We leveraged digital capabilities like Virtual Assistants, messaging applications, augmented channel-based acquisition capability and Geo tracking to offer end-to-end digitisation of the loan lifecycle critically needed by leading global FIs. In the increasingly digitised world, the integrability and compatibility of a software solution with other software providers have become increasingly critical. Nucleus’ FinnOne Neo® has been a leader on this front, and carrying many APIs: 480+ in its API stack facilitates robust, secure, quick and agile integration.

Our last release of FinnAxia® enabled corporates to make informed decisions on their cash positions and banks to seamlessly provide integrated, one-stop secured solutions to their corporate customers. Supporting the increasing need for real-time operations, FinnAxia® enabled cash forecasting capabilities for banks’ corporate clients and provided enriched MIS. These features are a requirement for global banks that provide transaction banking services.

Our financial inclusion product, PaySe™, which digitises last-mile users on the ground, has been granted multiple patents for its unique offline and online payment processing capabilities. These capabilities aim to achieve real financial inclusion at the grassroots level. PaySe™ currently addresses the needs of the SHG (Self Help Group) ecosystem by enabling them with an easy and convenient way to conduct digital transactions. Additionally, it addresses challenges faced by people in rural areas, including financial illiteracy, limited internet connectivity, lack of access to smartphones, and the need to travel to banks. Many developing nations are looking to PaySe™ to transform their economic landscape.

By dedicating ourselves to the BFSI segment, we have optimized every process. Our solutions enable quick expansion across geographies, and our low-code/no-code platforms are easy to implement, robust, and agile. Our 540+ API stack allows our platforms to integrate seamlessly with our clients’ financial ecosystems and plays a big role in helping them achieve embedded banking.

Handling high-value transactions requires robust strategies and technologies. How does Nucleus Software approach the development of such strategies, and what technologies do you employ to ensure a secure and financially prepared ecosystem for your clients?

High-value transactions require extreme due diligence and secured infrastructure. Our AI-powered platform, FareEdge, enables an extra layer of security by detecting transaction anomalies on the go. We constantly evaluate new technologies that we can bring into this space. The other dimension of a robust strategy is to ensure that the platform is scalable and robust enough to handle high-volume transactions as well.

Nucleus Software has a history of creating outstanding solutions that are elastic and scalable. We have plethora of well documented experiences that we imbibed over three decades and this domain expertise is continuously enabling us to create high performance applications. In addition, we believe in continuous improvement and so we keep elevating the performance parameters benchmark to set new industry standards that are always ahead of time. Our benchmarking lab is uniquely designed for this purpose.

At Nucleus Software, we ensure the highest quality of our products through very mature validation and verification strategies and modelling. The key driving principle for us has been quality at source. We ensure a balanced focus on both Functional Requirements and non-functional requirements. We develop and test platforms keeping the end objective in view, and these approaches enable us to deliver high-quality, robust platforms, giving our customers unmatched experiential certainty.

We implement the principles of lean and go shift left by ensuring governance in structured code reviews followed by industry-standard pipelines to ensure a stringent quality gate. We also invest significantly in finding ways and techniques to help evolve our test dimensions. We employ a composable architecture that allows for flexible and modular solutions, ensuring scalability and resilience. We facilitate seamless interactions between different financial systems by focusing on open banking principles and robust API integration. We create intelligent solutions that enhance decision-making and operational efficiency by leveraging artificial intelligence and advanced analytics. Additionally, our cloud-agnostic technology ensures that our solutions are adaptable to various cloud environments, providing our clients with the necessary flexibility.

At present, we facilitate 26 million transactions each day through our globally integrated transaction banking platform. Our lending platform manages US $500 billion of loans in India alone and over US $700 billion of loans globally other than India while enabling 500,000+ users to log in daily.

Nucleus Software has recently achieved significant success in acquiring new clients. Can you share details about some of these new partnerships and how they are expected to contribute to your company’s growth and expansion in the coming years?

For the past three decades, Nucleus Software has developed technologies that have significantly impacted the BFSI domain. Nucleus Software has set a benchmark in the BFSI industry, cementing the story of three decades of Indian IP.

One of our notable partnerships is with Mahindra Rural Housing Finance in their digital transformation journey. This collaboration aimed at enhancing customer experience, transparency, and operational efficiency while ensuring ease of use, scalability, security, and sustainability at every step. Mirae Asset Financial Services (India) chose Nucleus Software to develop and implement a unique customer onboarding mobile app for solutions that would allow customers to avail loans against their mutual funds and shares online quickly without having to visit branches or submit physical paperwork. BRAC Bank and Nucleus Software winning the IBS Intelligence Global FinTech Innovation Awards for deployment of Supply Chain Finance solutions for SMEs is an example of the success of our collaborative work. Bank of Sydney went live with Nucleus Software’s digital lending platform FinnOne Neo® to enhance digital customer experience with a faster approval process and customised customer communications, proving our dedication and expertise in the Australian market. Muthoot Fincorp chose Nucleus Software for the Next Phase of Digital Transformation with Nucleus FinnOne Neo®. The seamless implementation of the digital lending platform means all loan applications are now processed through FinnOne Neo®. We partner with 200+ Financial Institutions across 50+ countries, but these are few partnerships that we can mention.

Our objective is to empower our clients by aligning technological capabilities with their business strategy, providing a foundation for flexible, scalable, and future-proof systems that enhance speed and efficiency while keeping end-customers satisfaction paramount. Some of our esteemed technology partners include AWS, IBM, Gartner, Microsoft, and Oracle.

We plan to enter one or two developed markets, and our growth has been fuelled by building products that align with each geography and forming compatible alliances with strategically selected implementation partners globally to provide their clients with a customised experience.

As the financial industry rapidly evolves, what is Nucleus Software’s long-term vision for the future of banking? How do you continuously improve your products and solutions to stay ahead of industry demands and technological advancements?

At Nucleus Software, we envision a future where banking seamlessly integrates into consumers’ digital lives, prioritising innovation, agility, and personalised solutions. As a leading product company, we invest heavily in R&D to stay ahead of industry demands and technological advancements, aiming to make access to financial services easy and enriching globally.

Apart from our usual business, we aspire to enhance customer experience through Gen AI, which brings accuracy to personalised solutions. We are also working towards enhancing Business Agility by creating an ecosystem for packaged business capabilities. Another area we are working towards is making digital transactions tamper-proof and transparent by creating infrastructure with decentralised storage and distributed ledgers. We have a dedicated team to review and plan continuously the implementation of technological advancements that have the potential to create value for our customers.

With the adoption of Acceptance Test-Driven Development (ATDD) moving toward continuous integration and eventually continuous delivery (CICD), Nucleus Software is following proven principles of lean manufacturing in software development for the banking technology sector. This move aims to redefine software development methodologies by significantly reducing the release cycle while ensuring seamless alignment between software solutions and end-user requirements, thus accelerating the pace of customer value realisation.

We are committed to fostering a banking ecosystem where emerging technologies enhance security, efficiency, and customer trust. Using a technology-first approach, we ensure that our services develop scalable, secure, and highly customisable solutions tailored to customer goals.

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