Recruiting for Core Banking System Expertise: Why Banks Struggle to Hire Tech-Savvy Talent

Modern banking depends heavily on the core banking system — that central platform through which deposits, loans, payments, ledgers, and regulatory compliance are managed. With digital transformation accelerating, community and regional banks are under mounting pressure to upgrade their legacy cores or migrate to more modern, cloud-native, API-driven platforms. Yet recruiting people who understand both legacy and next-gen core systems is one of the toughest hiring challenges for banks in 2025–26.

What the Data Tells Us

• According to the ABA’s Core Platforms Survey 2025, only 53% of banks are satisfied with their current core platform providers, while about 35% are dissatisfied—often citing weak vendor support and limited innovation. (aba.com)

• The U.S. core banking software market is projected to grow from about USD 6.09 billion in 2025 to USD 16.81 billion by 2032, at a CAGR of ~15.6%. Community banks are among the fastest adopters. (fortunebusinessinsights.com)

• Industry analysis (Fintech Futures / Omdia) finds that more than 64% of banks’ technology budgets still go to maintaining legacy systems rather than innovating. (fintechfutures.com)

Why This Recruitment Challenge Is Growing

1. Legacy Systems = Skill Gaps
   Many core banking systems are built on outdated codebases (COBOL, proprietary vendor systems). Few younger engineers are trained to maintain or migrate them.

2. Integration & Migration Complexity
   Core banking transformation involves data integrity, customer continuity, regulatory oversight, and risk management—not just IT. Candidates who’ve led such projects are scarce.

3. Vendor Lock-In
   Long contracts tie banks to providers like FIS, Fiserv, and Finastra. Specialists who can customize or extend vendor platforms are highly sought after.

4. Competition from Fintechs
   Talented engineers gravitate toward fintech startups or big tech firms where they work on modern stacks, enjoy flexible culture, and access equity. Community banks often struggle to compete.

5. Regulatory & Security Demands
   Core banking talent must balance tech with compliance—AML, KYC, data privacy, and cybersecurity. That hybrid expertise is rare.

Employer & Recruiter Strategies to Fill this Gap

• Partner with core vendors & integrators: Recruit from consulting firms or fintechs who have hands-on implementation experience.

• Upskill internally: Train IT and Ops staff in APIs, cloud migration, and modern core architecture.

• Offer flexible hiring models: Contract, remote, or fractional hires can bridge gaps during major projects.

• Refresh employer branding: Emphasize modernization and professional growth to attract engineers.

• Benchmark compensation: Salaries plus flexible work arrangements and modern tooling help secure scarce candidates.

Case Examples

• A Midwest regional bank sought engineers for a core migration. By reframing its job postings to emphasize both legacy COBOL skills and cloud-native projects, it doubled qualified applicants.

• A fintech core vendor attracted engineers by promoting remote work, open-source contributions, and the chance to work on modular cloud-native architecture—appealing to technologists seeking growth.

Summary

Recruiting for core banking system expertise is becoming one of the biggest bottlenecks for community and regional banks. The combination of legacy tech, regulatory oversight, and integration complexity requires talent with dual skills—legacy knowledge and modern engineering. Banks that invest in internal training, craft compelling employer value propositions, and partner with recruiters who know the fintech + banking landscape will be better positioned to attract scarce talent. For candidates, this niche represents high impact and high demand: those who can straddle both legacy and next-gen systems will be indispensable in 2026 and beyond.