Magic Quadrant for Retail Core Banking Systems, Europe
6 October 2025 - ID G00834018 - 46 min read
By Vittorio D'Orazio, Ali Merji
Core banking systems are defined as back‐office banking systems that process daily transactions and post updates to accounts and other financial records. This research assesses CBS vendors in Europe based on their market positions, product strategies and alignment with crucial market trends.
Market Definition/Description
Gartner defines a core banking system (CBS) as the financial institution’s back‐office software that performs real-time or end-of-day processing for deposits and loans. Apart from advancing the processing dates, representative capabilities include transaction posting, interest accrual/payment, service charge calculation and cash management (zero balance, target balance). CBSs provide deposit and loan product servicing with interfaces to other applications, such as customer-facing channels, general ledger systems and reporting tools. CBSs can be deployed on the bank’s premises or run from the cloud or any hosted environment. Bank employees and customers either directly or indirectly use the bank’s CBS.
The CBSs of a financial institution’s back‐office software perform either real-time or end-of-day processing for deposits and loans. Apart from advancing the processing dates, representative capabilities include transaction posting, interest accrual and posting, service charge calculation and cash management (zero balance, target balance). All these processes and steps imply a business model based on conventional banking principles that imply interest accrual on accounts and profitability from any lending practice. Therefore, CBSs, by definition, implicitly exclude Islamic CBSs that, to the contrary, use Islamic financial tools to back Shariah-compliant business models that require different mechanisms to produce profits.
Mandatory Features
The mandatory features for this market include transaction processing support for at least one type of deposit and one type of loan product servicing:
- Deposits:
- Current or checking accounts
- Savings accounts
- Fixed-term deposits
- Loan product servicing:
- Consumer (or retail) loans
- Commercial (or corporate) loans
- Mortgages (or asset-backed loans)
Optional Features
The optional features for this market include components that are orbiting around and are connected to the mandatory components:
- The integration layer of applications to other technologies such as customer-facing channels, general ledger systems, reporting tools and connectivity to payment hubs or systems that enable payments. This integration layer includes either custom-made interfaces or application programming interfaces (APIs).
- The accounting general ledger (GL) that records the transactions and keeps a record of that. The GL is not considered part of the core system, but it is a common feature that many vendors offer together with the core system. Some products must be bound to that specific GL, but the vast majority can opt out and offer integration with any GL. Also, it is notable to say that the newest core systems do not even need a GL.
- The product factory that generates particular specific deposit or loan products based on the configuration of the business users.
- The customer information file (CIF) that collects data about each customer.
- Account information component that characterizes each type of account.
- Account transaction information collects information about each transaction and the relative associated payment.
- Reporting tools of any kind (e.g., regulatory reporting).
- Tellers and branch transaction processing to connect to these specific traditional channels.
- Security for access and identification.
- Cash management module.
- Trade finance module.
Magic Quadrant
Vendor Strengths and Cautions
Finastra Essence
Finastra Essence is a Leader in this Magic Quadrant. Finastra is a privately owned company based in the U.K. Its total revenue is estimated to be $1.9 billion, and it has a workforce of 7,500 employees. In Europe, Finastra has 11 offices, and its CBS product, Essence, has 25 installations and acquired 10 new clients between 2023 and 2024.
Essence primarily utilizes Java as its main development language, with additional coding languages including JavaScript, Vue.js, Node.js, Swift, and Kotlin for Android. For production database management, Essence relies on Oracle, Db2 and PostgreSQL. Its application servers are IBM WebSphere Application Server and Red Hat JBoss Enterprise Application Platform (EAP).
- Viable roadmap: The viability of Finastra’s two-year roadmap has been highly rated in end-user surveys. The roadmap enables the vendor to rapidly spread innovations from advanced European countries to other, more sluggish areas. Customers benefit by gaining faster access to new features and best practices across the region.
- Extensive local sales support: Finastra’s extensive team of sales representatives and its local offices across Europe enable it to provide responsive, personalized support to clients in their own regions. Combined with a strong sales strategy and a broad network of global partners in both Western and Eastern Europe, customers benefit from faster service, tailored solutions and access to a wide range of expertise.
- Strong business functionalities: Essence offers strong business functionalities that support effective business alignment with the needs of a wide range of bank client types (i.e., retail, SMBs, corporations, etc.), along with some of the strongest customer information features in the market. This enables customers to tailor solutions to their unique requirements and gain deeper client insights, resulting in improved business performance and more personalized experiences.
- Fewer APIs: Essence provides 300 APIs — fewer than those offered by many competitors, which often span over 1,000 — with only 110 based on open standards. Additionally, these numbers have not increased recently. The vendor also lacks compliance with Banking Industry Architecture Network (BIAN) standards, which are important for interoperability. This may limit customers’ integration options and increase long-term costs.
- Limited cloud nativeness: Although Essence is created to leverage cloud ecosystems such as Microsoft Azure, it is less cloud-native than many of its competitors. It requires some degree of manual effort for updates and deployments, according to users. Also, end-user surveys indicate that the product generates a high number of network calls, leading to potential single points of failure in the process.
- Higher pricing: Gartner’s review shows that Essence’s pricing is above the market average, so customers should expect higher costs compared to most competitors.
FintechOS
FintechOS is a Challenger in this Magic Quadrant. It is a privately owned company based in the U.K.,
with total revenue estimated at $17 million and a workforce of 225 employees. In Europe, FintechOS has two offices, and its CBS product, the FintechOS platform, has 37 installations and has acquired five new clients between 2023 and 2024.
The primary development language for this product is Microsoft C#, complemented by JavaScript and Java as additional coding languages. For production database management, it utilizes Microsoft SQL Server and PostgreSQL. Both its application server and server platform are based on Microsoft Azure.
- Positive customer experience: Bank customers report a positive experience in both deployment and support of the core product. FintechOS is responsive to clients’ inquiries and escalations by using its main operational center in Romania (where it was founded).
- High product viability: End-user surveys indicate that FintechOS is a high-value-for-money product. Additionally, it has a strong product sales pipeline, which has grown since the previous year. It also invests around 60% of its revenue in R&D, most of which goes toward building missing functionalities and fixing bugs, and for performance improvements. Therefore, customers can benefit from innovative solutions and excellent cost-efficiency.
- Strong sales execution: Users rate FintechOS’s product evaluation and contract negotiation highly, thanks to the vendor’s fast responsiveness. Also, the vendor’s product pricing is lower, on average, than its competitors. This makes it attractive in price-sensitive markets such as fintechs, neobanks and nonfinancial institutions.
- Limited business functionalities: FintechOS offers limited business functionalities compared to its competitors, particularly in account transactions, teller/branch transactions, cash management and trade finance, which may limit operational capabilities for customers. Additionally, its limited cloud-native architecture could restrict scalability and modernization for organizations seeking robust public cloud deployment.
- Lack of innovation: FintechOS lacks innovation labs, mature partner collaboration and BIAN membership, which may limit customers’ access to advanced industry standards and architectural insights. Its innovation and AI capabilities are basic, potentially restricting customers seeking cutting-edge solutions.
- Narrow product roadmap: FintechOS focuses more on maintaining existing features than advancing product architecture, which may slow innovation and limit future capabilities for customers. Its centralized roadmap approach also restricts ecosystem collaboration, potentially reducing access to new integrations and industry trends.
Infosys Finacle
Infosys Finacle is a Leader in this Magic Quadrant. EdgeVerve Systems is an Infosys company based in India. Infosys Finacle is the unit as well as the brand under which EdgeVerve systems sells its product, Finacle Core Banking Solution. Gartner estimates the total company revenue at $440 million. The vendor has a workforce of more than 6,000 employees. In Europe, EdgeVerve Systems has 53 offices, and its product, Finacle Core Banking Solution, has 41 installations and acquired four new clients between 2023 and 2024.
The main development languages are C and C++. DBMSs include Oracle, PostgreSQL, EnterpriseDB and Redis. Application servers are Apache Tomcat, Red Hat JBoss EAP, IBM WebSphere Application Server and Oracle WebLogic. The platforms include Red Hat Enterprise Linux, IBM AIX, IBM Power, IBM Z, IBM LinuxONE, HPE HP-UX and Oracle Sun Server.
- Strong cloud-native architecture: Finacle Core Banking Solution v.11.x delivers strong cloud-native architecture based on the high independence of its components and highly composable solutions, enabling customers to easily scale and adapt their systems. Its advanced business functionalities empower organizations to streamline operations and stay competitive.
- Positive customer experience: Infosys Finacle consistently receives high ratings from bank clients for its customer experience, with prompt vendor responses, smooth integration and deployment, and reliable product support. Customers will benefit from efficient operations and dependable service throughout their engagement.
- Proactive industry involvement: The vendor is a BIAN member that actively engages with the banking industry through its annual event called Conclave, which includes research presentations, roundtables, user groups, innovation labs and hackathons. This enables customers to engage directly in product development, access the latest innovations and influence the solution roadmap to better meet evolving needs.
- Coexisting versions: Infosys Finacle offers two main versions of the same product (v10.x and v11.x). While product R&D investments focus exclusively on v11.x, maintaining support for two coexisting releases may constrain innovation by diluting investment capacity. Also, the vendor’s push to migrate most clients to its latest cloud-native and composable release has been met with reluctance. Many clients are not yet prepared for the big architectural changes, which involve trading off existing customizations with APIs needed for containerized deployment in the cloud.
- Sales challenges: The vendor’s limited use of system integrators across Europe and the request received by existing customers to migrate to v.11.x have led to a challenging sales strategy and lower success rates, raising concerns among bank clients. Customers should be aware of potential complexities during upgrades and project delivery.
- Gaps in multicloud adoption: Infosys Finacle’s cloud delivery adoption is limited, with most v10.x clients still on-premises. The product faces challenges in multicloud deployment, such as the lack of real-time synchronization across providers. Customers may face higher costs and reduced flexibility if advanced multicloud capabilities are required.
Intellect Design Arena
Intellect Design Arena is a Visionary in this Magic Quadrant. It is a BSE Sensex-listed company based in India. In 2024, it rebranded its CBS product as eMACH.ai (formerly Intellect Digital Core). The vendor has a total revenue of $290 million and 5,694 employees. In Europe, Intellect Design Arena has nine offices, and eMACH.ai has 81 installations and acquired three new clients between 2023 and 2024.
The primary development language for this product is Java. Additionally, it is coded in Spring Boot, Bootstrap, RESTful, gRPC, HTML, CSS, Angular, TypeScript and Sass. The product supports Oracle and PostgreSQL DBMSs. For application servers and server platforms, it utilizes Oracle WebLogic, Apache Tomcat and IBM WebSphere Application Server.
- Strong product functionalities: The product offers strong off-the-shelf functionalities compared to most competitors, reducing the need for costly customizations and extra applications. As a BIAN member, Intellect Design Arena ensures alignment with industry standards for easier integration.
- Comprehensive global market understanding: The vendor’s global market analysis is based on a very structured process and blends industry expertise and connections with direct client feedback. This ensures that solutions are tailored to customer sentiments and needs. Customers benefit from products that reflect broad market trends and local requirements, enhancing relevance and value.
- Sales and geographic strategy: The vendor is expanding its presence in Europe by opening local offices and hiring more engineers, especially after securing major regional deals. Customers will benefit from enhanced, locally focused support and a more technically mature service team, improving project outcomes and ongoing assistance.
- Limited product composability: The product’s limited modularity, low component discoverability and broad but lesser granular APIs, compared to the sizable breadth of the offering, may require customers to invest in significant customization to interface with their diverse business needs. European clients should closely assess composability to ensure the solution fits integration and flexibility requirements.
- Nonoptimal operations: The product has persistent gaps in the automation of CBS configuration updates and deployments. The vendor has yet to mature in delivering the core software by using new models such as the public cloud and by providing daily updates. The on-premises updates are only delivered every six months, and only 30% of customers have the latest version.
- R&D viability: Intellect Design Arena’s below-average R&D investment and limited human resource allocation — further diluted by being spread globally — may slow innovation and product updates. This results in very low roadmap viability. Customers should assess whether the vendor can keep pace with rapid industry changes, especially driven by new regulations and the shift from on-premises to cloud.
Mambu
Mambu is a Challenger in this Magic Quadrant. It is a privately owned company based in the Netherlands. The vendor’s total revenue is estimated at $135 million and it has a workforce of 550 employees. In Europe, Mambu has five offices, and its cloud banking platform has 96 installations and acquired 14 new clients between 2023 and 2024.
The product is developed in Java. Mambu is available exclusively as a SaaS solution on Amazon Web Services, Microsoft Azure and Google Cloud Platform. As a SaaS deployment, Mambu’s technology stack is determined by the technologies of the chosen hosting environment.
- Highly composable and cloud-friendly: Mambu’s decade-long public cloud deployment and high cloud nativeness ensure reliability and modern architecture. Its composable design, powered by 800 RESTful APIs and microservices, offers seamless interoperability and scalability. Customers benefit from flexible integration, future-proof scalability and efficient operations.
- Competitive pricing and flexible contracts: Mambu’s strong local presence and global partner network ensure reliable support and smooth delivery across Europe. Clients benefit from flexible contract negotiations and deployment options, as well as competitive pricing and low total cost of ownership (TCO). This makes Mambu a cost-effective and adaptable choice for European organizations.
- Flexible installation and support: Mambu delivers core installations remotely, enabling rapid deployment through a structured 12-week program. Customers benefit from flexible on-site options if needed, and highly organized, efficient remote support. This approach leverages the cloud for faster, cost-effective implementations and positive user experiences.
- Limited adaptability to local regulations: Mambu’s limited attention to local regulations and customization in Europe can restrict product functionality and adaptability to local accounting standards. This is often the case with SaaS models, as the benefit of SaaS is a centralized codebase, which makes business-specific changes difficult. Customers reported challenges with localization and making business-specific changes, such as modifying the interest rate engine. This might result in a slower response to local needs.
- Limited core business functionalities: Mambu relies on third-party partners for advanced features like commercial lending, cash management and trade finance. Regional business needs, including regulatory reporting and local accounting rules, are not included in its core roadmap. Customers may need additional integrations to meet specialized or regional banking requirements.
- Innovation: Mambu has not yet invested in GenAI or AI. It relies on external partners for innovation rather than embedding it in its core product. Customers may miss out on the cutting-edge AI features and faster innovation that competitors offer. This could lead to a technological gap and limit future capabilities for both the vendor and the bank using this product.
Oracle FLEXCUBE
Oracle FLEXCUBE is a Visionary in this Magic Quadrant. Oracle Financial Services Software (OFSS) is a controlled subsidiary of Oracle and is based in India. This subsidiary has a total revenue of $780 million and a workforce of 8,887 employees. In Europe, OFSS has six offices, and its CBS product, Oracle FLEXCUBE Universal Banking, has 183 installations and acquired five new clients between 2023 and 2024.
The primary development language for the product is Java, with HTML5, JavaScript and CSS3 used as additional coding languages. The production DBMS is Oracle. The product uses Oracle WebLogic as its application server and runs on Linux as the server platform.
- Business functionalities: Oracle FLEXCUBE Universal Banking provides a wide range of business functionalities with granular features, supported by its experience in numerous installations and deployment scenarios. Customers gain access to comprehensive capabilities that address diverse banking requirements.
- Integrated API marketplace: OFSS leverages cross-industry collaboration and offers an API marketplace that is fully integrated with the larger Oracle API marketplace. This enhances connectivity and innovation for customers. Oracle’s BIAN membership and the adoption of Oracle Coherence further support ongoing product development.
- Use of AI: OFSS, in line with Oracle’s data-driven approach, integrates embedded AI and GenAI directly into FLEXCUBE’s core product. Customers might benefit from advanced features like automated spend categorization by leveraging the data from the ISO 20022, personalized loan repayment schedules and streamlined product creation. These enhance efficiency and support smarter business decisions.
- Risk of vendor lock-in: Clients should be aware that adopting Oracle FLEXCUBE Universal Banking typically requires using the broader Oracle ecosystem, including Oracle DBMS, Oracle Cloud Infrastructure, Oracle Siebel, etc. This vendor lock-in risk can limit flexibility and increase dependency on a single provider.
- Product viability challenges: The coexistence of legacy Oracle FLEXCUBE components and new components under the Oracle Banking Cloud Services brand may complicate client environments, especially since the vendor is rebuilding the core. Limited investment in the product roadmap further raises concerns about long-term viability, particularly on the regulatory front. Customers might anticipate potential complexities during implementation and consider risks related to ongoing innovation and support.
- Cloud nativeness: Oracle FLEXCUBE Universal Banking is reported to lag in cloud-native capabilities, with limited hyperscaler partnerships and automation for configuration and deployment. Customers not on Oracle Cloud Infrastructure (OCI) may experience reduced performance, potential single points of failure and less flexibility compared to more cloud-native solutions. This can impact scalability and may not align with European organizations that are prioritizing advanced and broader cloud delivery models.
TCS BaNCS
TCS BaNCS is a Leader in this Magic Quadrant. It is a strategic business unit of Tata Consultancy Services (TCS) based in India. TCS BaNCS has an estimated total revenue of about $310 million and 3,361 employees. In Europe, TCS has 56 offices, and its CBS product, TCS BaNCS, has 50 installations and acquired four new clients between 2023 and 2024.
The product is developed in Java/Java EE. Its production DBMSs include Oracle, PostgreSQL and IBM Db2. The product utilizes Oracle WebLogic, IBM WebSphere Application Server, JBoss and Apache Tomcat as application servers, and runs on Intel x86, IBM Power and Oracle SPARC server platforms.
- Positive customer experience: At a global level, TCS BaNCS provides an above-average customer experience. Customers benefit from TCS’s role as a system integrator, which streamlines support, speeds up issue resolution, and improves case management and escalation processes.
- Strong overall viability: TCS BaNCS demonstrates strong financial and product viability, backed by TCS. Clients also indicate that it provides high value for the money and a viable roadmap. Customers can expect a stable vendor with reliable long-term support and a product roadmap focused on future value.
- Comprehensive business functionalities: TCS BaNCS offers a complete set of components developed through extensive experience with European banks. Customers benefit from robust, end-to-end solutions that address a wide range of banking needs. This supports efficient operations and adaptability to market requirements.
- Limited sales partnerships: TCS BaNCS’s sales strategy is limited by a lack of local partners as TCS is the only global partner it works with. Customers may experience slower regional support and fewer localized resources in countries outside the TCS network. This could impact responsiveness and access to tailored solutions in certain markets where TCS does not directly operate.
- Dual software release strategy: TCS BaNCS maintains two sets of components (Java and COBOL), which complicates the product release strategy. Customers may encounter slower updates and less streamlined enhancements due to this dual maintenance approach. This could affect the speed at which new features and improvements are delivered.
- Limited ecosystem: TCS BaNCS has limited local and global partner variety for deployment and integration, especially in Europe. Customers often rely on TCS consultants from other countries, such as India and the U.K., who may have less familiarity with local regulations, accounting standards, and language and business practices. This can impact the quality and relevance of implementation and ongoing support for European regional needs where TCS does not directly operate.
Temenos
Temenos is a Visionary in this Magic Quadrant. It is a SIX Swiss Exchange-listed company based in Switzerland. The vendor has a total revenue of $1.044 billion and a workforce of 6,427 employees. In Europe, Temenos has 18 offices. Gartner estimates that its CBS product, Temenos Core Banking, has 183 installations across Europe and acquired 22 new clients between 2023 and 2024.
The primary development language for the product is Java, complemented by Python and JavaScript. Supported production DBMSs include Oracle, PostgreSQL, SQL Server, Azure SQL Database and Amazon Relational Database Service (RDS). The solution leverages application servers such as WildFly, JBoss, IBM WebSphere Application Server and Oracle WebLogic, and operates across Amazon Web Services, Microsoft Azure, Linux, UNIX and Windows Server platforms.
- New partner strategy: In 2024, Temenos introduced a new strategy focused on improving client support through more stringent local partner certification requirements. Customers now benefit from improved product support, faster vendor response times and higher service quality, and this has led to greater customer satisfaction.
- Innovation: Temenos fosters innovation both internally, through its Chennai, India facility and externally via a well-organized API marketplace with over 100 partners. In 2025, it launched a global network of centers of excellence to co-innovate with clients and partners (the first one was launched in the U.S. in June 2025). Customers can expect access to innovative solutions and faster adoption of new technologies.
- Proactive stakeholder outreach: Temenos actively engages clients, partners and stakeholders through initiatives like the Temenos Community Forum. Its Value Benchmark program helps customers benchmark and understand how to resolve issues or decide whether to upgrade. Additionally, the Temenos Academy offers certification programs for product expertise, while the Temenos Learning Community supports the exchange of experiences.
- Pricing model change: Temenos is moving all customers to a subscription-based pricing model by 2028. This might require changes to expiring contract terms. Some clients are already facing advance requests to update expiring agreements, which might impact budgeting and contract negotiations. Customers should review contract timelines and prepare for potential adjustments to pricing structures.
- Management change: In 2024, Temenos hired a new CEO who brought in new talent alongside the existing management team. This combined leadership crafted the company’s new strategy throughout 2024 and the first half of 2025. However, in early September 2025, the CEO unexpectedly stepped down from his position, and the long-standing CFO took over. This change could create uncertainty and risk. Temenos publicly stated that its strategy for FY 2024 to FY 2028 remains unchanged, and it has reconfirmed its FY 2025 to FY 2028 financial targets.
- Architectural limitations: Temenos Core Banking’s architecture is not fully composable or cloud-native, with end users noting that modernization is still needed. Customers may face limitations in flexibility, scalability and integration with newer technologies. The timeline for these improvements remains unclear, posing risks for future adaptability.
Thought Machine
Thought Machine is a Leader in this Magic Quadrant. It is a privately owned company based in the U.K.
The vendor has an estimated total revenue of $67 million and a workforce of 500 employees. In Europe, Thought Machine has four offices, and its product, Vault Core, has 22 installations and acquired seven new clients between 2023 and 2024.
The product is developed primarily in Golang, with Python also utilized for product configuration. For production, it relies on PostgreSQL as its DBMS, and its application servers operate on Google Cloud Platform, Amazon Web Services and Microsoft Azure. For on-premises solutions, the product supports server platforms including Google Cloud Platform, Amazon Web Services, Microsoft Azure and Red Hat OpenShift.
- Composable architecture: Thought Machine offers a highly composable, cloud-native architecture, enabling easy integration and rapid deployment of new features. As a BIAN member, it supports industry-standard interoperability. Customers benefit from greater flexibility, scalability and smoother integration with other banking systems.
- Strong viability: Thought Machine is backed by Tier 1 banks, including Lloyds Banking Group, JPMorganChase and Intesa Sanpaolo as both shareholders and end users, demonstrating strong industry confidence. End-user surveys highlight high value for the money and a robust product roadmap. Customers can expect reliable innovation, financial stability and ongoing product enhancements.
- Product experience: Global end users positively review Thought Machine across the entire product life cycle, from evaluation and contract negotiation to integration, deployment and ongoing support. Customers can expect a smooth onboarding process and reliable long-term service, reducing risk and ensuring a positive overall experience.
- Limited business functionalities: Vault Core is country-agnostic and lacks key business functions that depend on localization, such as customer information, corporate lending, reporting and cash management, requiring banks to build or source these separately. This can be challenging and costly for midsize to small banks lacking resources for customization. Additionally, any new functionality developed by users through assembling the product’s services (“smart contracts”) may become the intellectual property of Thought Machine, limiting ownership and control.
- Limited localization and support: Vault Core lacks essential country-specific features, such as regulatory reporting and local lending products, requiring banks to fill gaps with custom solutions or third-party providers when available. Customers may face increased integration complexity and costs, especially in markets with unique requirements. Limited local partner support may further hinder successful localization and compliance.
- Limited innovation: Thought Machine’s R&D prioritizes filling basic functionality gaps by developing “smart contracts.” It focuses less on driving innovation, such as AI or advanced business features. Customers seeking cutting-edge capabilities may find the pace of innovation slow, limiting access to emerging technologies and future-proofing opportunities.
Vilja
Vilja is a Niche Player in this Magic Quadrant. It is a privately owned company based in Sweden. The vendor has an estimated total revenue of $9 million and a workforce of 78 employees. In Europe, Vilja has two offices (in Sweden and the U.K.), and its CBS product, Vilja Platform, has 39 installations and acquired 12 new clients between 2023 and 2024.
Java serves as the primary development language for this product, with JavaScript as an additional coding language. The solution is a Linux-based, containerized offering designed for a multitenant environment, leveraging PostgreSQL and MongoDB as its production DBMSs.
- Frequent product releases and customer proximity: Vilja delivers monthly software updates to all cloud clients, ensuring they always benefit from the latest features and security enhancements. Its high-frequency release cycle and strong product support enable rapid response to market needs. Customer responses from the Nordic region in particular indicate that the vendor is reliable and attuned to their local requirements.
- Strong viability: Vilja is recognized for its strong sales pipeline and significant human capital investment in R&D (64%). Customers benefit from a stable vendor that is well-positioned to deliver ongoing product enhancements and long-term support.
- Sales execution: Vilja consistently secures new clients and is expanding beyond its Nordic base, with recent wins in the DACH market and the Netherlands. The vendor has recently opened a sales and development center in Kuala Lumpur to support the Asia/Pacific region This growing international presence demonstrates strong product appeal and adaptability.
- Lagging in standards: Vilja lacks an API marketplace and is not a BIAN member. This may restrict integration options and collaborative development in areas such as AI innovation and additional product offerings. Customers should consider these factors if advanced integration and innovation are priorities.
- Lack of AI focus: Vilja lacks robust engagement with emerging AI trends and does not have external partnerships that are vital for developing embedded AI within the core. This could slow the adoption of new technologies and Vilja’s ability to progress in this competitive market.
- Limited product offerings: The vendor’s product suite offers limited business functionalities. It lacks key features like multicurrency accounts, cash management and advanced transaction processing. Its cloud capabilities lack full support for cloud-native technologies. Customers needing comprehensive features or robust cloud infrastructure should carefully assess fit.
Vendors Added and Dropped
We review and adjust our inclusion criteria for Magic Quadrants as markets change. As a result of these adjustments, the mix of vendors in any Magic Quadrant may change over time. A vendor's appearance in a Magic Quadrant one year and not the next does not necessarily indicate that we have changed our opinion of that vendor. It may be a reflection of a change in the market and, therefore, changed evaluation criteria, or of a change of focus by that vendor.
Added
No vendors were added to this Magic Quadrant.
Dropped
- 10x Banking: 10x Banking is a U.K.-based provider founded in 2016 that launched its new product, 10x Banking Platform, a few years ago. It was dropped because it did not have enough new wins and the required installation base, according to the 2025 inclusion criteria.
- Engine by Starling: Engine is a core system built and sold by the subsidiary of Starling Bank (based in the U.K.) called Engine by Starling, which provides the core to Starling Bank and a few banks in Europe. It was dropped because it did not have enough new wins and the required installation base, according to the 2025 inclusion criteria.
- Ohpen: Ohpen is a core provider based in the Netherlands, with software mainly focused on the lending side of core banking. It was dropped because it did not have enough new wins and the required installation base, according to the 2025 inclusion criteria.
- Profile Software: Profile Software is a core provider based in Greece, mainly focusing on Southern Europe, and its product is Finuevo Core. It was dropped because it did not have enough new wins and the required installation base, according to the 2025 inclusion criteria.
- SAP Fioneer: SAP Fioneer is based in Germany and is now a separate company from SAP. It sells SAP Transactional Banking for SAP S/4HANA with 91 installations throughout Europe. It was dropped because it did not have enough new wins, according to the 2025 inclusion criteria.
Inclusion and Exclusion Criteria
The inclusion criteria are the specific attributes that a provider must have to be included in this Magic Quadrant. To qualify for inclusion, providers need to demonstrate all of the following:
- Market activity: The retail core banking product should:
- Be actively sold in the marketplace
- Have proven evidence of 15 installations in production across Europe
and
- Active market presence: The retail core banking product should have proven evidence of a minimum number of three new wins in retail banking clients in Europe within the last three years (2022 to 2024).
Please note that, more specifically, “new wins” are defined as clients that (a) migrated from an older, different system to a new one, or (b) clients that installed the core system from scratch (i.e., “greenfield” projects). Any upgrade or reimplementation of an existing installation is not considered a “new win.”
Also, these migrations or greenfield projects must have involved the retail banking business line of the bank; must have included at least one form of deposit such as current accounts, savings accounts or fixed-term deposits; and the contract must have been signed off on in the past three years (from 2022 to 2024) with a bank that conducted such a project in Europe.
Evaluation Criteria
This Magic Quadrant has been informed by the previously published Magic Quadrant series with the same name and global focus, which was discontinued in 2023. Although some criteria have been retained, they have been updated to reflect new trends affecting this market and detailed later in this report. Additionally, the regional focus of this new Magic Quadrant and the new vendors entering this market since 2020 have more than doubled the number of vendors compared with the previous global report. Therefore, past reports are not directly comparable to this one.
This Magic Quadrant is, instead, a direct continuation of the last report published in January 2025.
Ability to Execute
The evaluation criteria for the Ability to Execute focus on market traction and on how the vendor and product are positioned to sustain support for near-term banking market requirements and commitments. Gartner has analyzed and compared 19 variables for each vendor’s CBS product, for a total of 58 data points, to map the vendors based on their Ability to Execute.
For this Magic Quadrant, Gartner formally and extensively leveraged three important sources of information:
- Two surveys of vendor references that occurred in July 2025 (n = 73) and in July 2024 (n = 99)
- The end-user feedback from Gartner clients received during many hundreds of inquiry calls
- Gartner Peer Insights feedback
This year, as well as in the past, we have formally excluded Marketing Execution from these criteria. It had a very low weighting in previous assessments, and we noted that it was of no importance for banks in their CBS selection process.
This Magic Quadrant axis emphasizes the following criteria, indicating their high importance and value for banks that are selecting CBSs:
- Product or Service: This is concentrated on:
- Business functionalities score
- Composability score
- Cloud nativeness score
- Overall Viability: This focuses on business units, financials, product strategy and organization. More specifically, we evaluate:
- Financial viability
- Product viability
- Customer Experience: This includes a focus on customer interactions as a result of surveys and it is linked to:
- Overall experience rating
- Vendor evaluation and contract negotiation rating
- Integration and deployment experience rating
- Product support and servicing experience rating
- Operations: This area of evaluation centers on how the vendor organization is equipped to provide infrastructure mechanisms or resources for the consistent attainment of business goals, including:
- Methodology of the software release strategy
- Implementation program/project management: Integration and deployment rating
- Implementation program/project management: Maturity of new sourcing models
- Product support and servicing experience rating
The following criteria have medium and lower importance, respectively, in this specific assessment:
- Sales Execution/Pricing: The sales process and its successful implementation in the marketplace, including the contract negotiation and pricing steps
- Market Responsiveness and Track Record: The ability to understand the bank’s needs and to effectively respond to changes in the market by modifying the product and quickly meeting those new requirements
Ability to Execute Evaluation Criteria
| Evaluation Criteria | Weighting |
|---|---|
Product or Service | High |
Overall Viability | High |
Sales Execution/Pricing | Medium |
Market Responsiveness/Record | Low |
Marketing Execution | NotRated |
Customer Experience | High |
Operations | High |
Source: Gartner (October 2025)
Completeness of Vision
The evaluation criteria for Completeness of Vision are based on the effectiveness of vendor product strategies linked to the market. Gartner has analyzed and compared 23 variables for each vendor’s product, leading to a total of 85 data points, in order to map the vendors’ Completeness of Vision.
For this Magic Quadrant, Gartner formally and extensively leveraged two important sources of information:
- Two surveys of vendor references that occurred in July 2025 (n = 73) and in July 2024 (n = 99)
- The Gartner Core Banking Survey, which surveyed more than 60 vendors worldwide and examined key information for all these products, including vendor’s strategy, product strategy and roadmap, and focus on innovation
This research assigns significance to the following criteria, which means that these criteria have high importance for banks selecting CBSs:
- Offering (Product) Strategy: This corresponds to the future projection of the product capabilities, and is evaluated from the analysis product roadmap in terms of organizational effectiveness of the vendor or product group’s development and delivery capabilities. Consistency and quality are key attributes. In particular, this criterion explores the consistency of the vendor’s product roadmap against key CBS market trends. Practical examples from Gartner interactions and use cases provided by the vendors have also been evaluated and considered in the assessment. The key product roadmap factors evaluated in this research are:
- Support for new business functionalities
- Investments in new architecture, data design, development environment or operating system environment
- Support for a composable architecture
- Support for a cloud-native offering
- Support for a strong ecosystem
- Innovation: This element focuses on the vendor’s ability to enable innovation in its standard product, nontraditional or differentiating partnerships, and associated market delivery. Many aspects of innovation have been considered, including:
- Innovation from inside: Use of “innovation labs”
- Innovation from outside: Use of partners for seeking innovation
- Innovation from co-working: the app marketplace capability
- Analysis of the three provided innovation examples
- Focus on innovative trends in CBS: AI
We have weighted the following criteria as Medium, which means that they have regular importance for banks selecting CBSs:
- Geographic Strategy: This element of the strategy demonstrates the vendor’s ability to directly serve bank customers and follow its global strategy by providing support across multiple geographies or by deeply penetrating the region both in terms of capabilities and capacity.
- Sales Strategy: This criterion evaluates the vendor’s strategy in terms of marketing and sales network, inclusive of an app marketplace, as well as the developed methodology to support the business development process. Also, we recognize the importance of partners in the sales and support activity for CBS projects by analyzing the type of partners available for each vendor and the role they have in CBS deliveries.
- Vertical/Industry Strategy: This is associated with banking industry commitment to broader initiatives (for example, participation in standards organizations and other industry groups), the vendor’s focus in terms of CBS investments and dedication. This area also focuses on unique hiring practices, training and other means of maintaining close industry relevance, such as specific areas of research.
- Market Understanding: This depends on regional factors such as local regulations, accounting standards and business customs, but also the ability to collect those factors and make them part of the vision for the roadmap within a broader understanding of the use of innovative technologies in the core banking sector.
We do not consider the marketing strategy and the business model as relevant for CBS selection.
Completeness of Vision Evaluation Criteria
| Evaluation Criteria | Weighting |
|---|---|
Market Understanding | Medium |
Marketing Strategy | NotRated |
Sales Strategy | Medium |
Offering (Product) Strategy | High |
Business Model | NotRated |
Vertical/Industry Strategy | Medium |
Innovation | High |
Geographic Strategy | Medium |
Source: Gartner (October 2025)
Quadrant Descriptions
Leaders
Leaders in the European retail core banking market possess a higher-level market understanding than peers, which helps in lead generation and, ultimately, in achieving more sales. In addition, they make it their business to monitor market trends and funnel progressive innovation into their product roadmaps. Most of them possess software development quality certifications (such as Capability Maturity Model Integration [CMMI] or BIAN compliance) or are pursuing them. The Leaders are also, without exception, “thinking small” by pursuing the client intimacy and proximity required to resolve tactical problems, or targeting composable architecture as a gateway to providing increased accessibility to the granular functionality that banks need to establish differentiation while easing cloud installations.
Leaders have high overall viability and great customer feedback. They also focus on innovation, and the innovation trends that affect this particular market. For example, their capabilities can advance key trends such as open banking ecosystems, facilitating integration with third-party products and embedding AI directly into their core platforms. They also respond to client demand for cloud deployment by gradually making their products more cloud-native with “API-fication” of the components and by introducing standards and the use of sandboxes.
Challengers
Challengers in this market typically earn high marks in key features of the product offering, such as composability or cloud nativeness. This is what the market wants most. Challengers also achieve superior customer experience and product support, based on client feedback. For these reasons, they are almost exclusively recently founded vendors that sell newly conceived products and still have sound customer intimacy to attentively deliver successful projects.
Challengers also have an opportunistic go-to-market approach, with limited market intelligence and scattered geographic strategy. They often don’t have a complete market understanding derived from long-standing experience within that geographic market, and their product offerings are weak on the business functionalities front, providing only basic out-of-the-box features.
Visionaries
Visionaries in the European retail core banking market have a solid focus on vertical industry and geographic strategy, with an extensive network of offices and a direct presence in their target markets. They also foster innovation and innovative trends, particularly from “inside,” using their own resources.
The greatest Visionaries heavily invest in the ecosystem and in innovation from “outside” and from partners, reducing resource constraints.
Vendors in this group are not in the Leaders quadrant mainly because of below-average levels in certain important capabilities of the product offering (i.e., composability or cloud nativeness) and/or the overall viability (i.e., the value-for-money rating) or customer experience (i.e., the overall experience rating).
Niche Players
Niche Players tend to have operations that are regionally limited and have lower regional market penetration than other vendors. Nonetheless, Niche Players in this Magic Quadrant do not simply participate in a few countries; they also focus on specific banking segments such as fintechs, neobanks and small banks. They still need to demonstrate presence elsewhere, despite their deep specialization in one specific regional market.
Usually, Niche Players are less involved in international trends and sales, while demonstrating great client proximity and intimacy, which are their most important differentiators. Their CBS products are not usually delivering well on market trends, and they often miss any commitments for these trends tracked by Gartner in the roadmap.
Context
The success or failure of core banking programs can be traced back to the clarity of outcomes defined in business cases (see Building the Digital Business Case for Core Banking System Renewal) at the outset. Banks need to focus much more on the preselection phase to ensure that their use cases are carefully constructed and transparent, and that their objectives are documented before they issue an RFI or RFP (see Toolkit: RFP Template for Core Banking Systems).
It is also important to evaluate the cost of a core banking system and compare the commercial offering from different vendors with the bank’s expectations by considering any hidden costs spanning from vendor selection to the maintenance of the core system after implementation (see Toolkit: Business Case Calculator for Projecting the TCO for Core Banking Systems).
When selecting vendors, bank CIOs need to consider vendors with proven expertise in this region, as featured in this Magic Quadrant. They should also consider additional vendors that may be relevant to the bank, such as those with preexisting relationships, high specialization or strong country-specific offerings, even if these vendors are small and not included in this research. A good overview of such a list of additional vendors is available in the regional toolkit. In fact, regional expertise and experience with banks of similar size and type are valuable qualities to find in a core banking vendor.
Gartner has focused its evaluation of retail CBSs on their ability to sell a product aligned with five key market trends examined in more detail in the Market Overview section:
- Composable architecture
- Cloud nativeness
- Business functionalities
- The ecosystem
- The use of embedded AI/GenAI
Bank CIOs and other IT and business leaders also need to be introspective, recognizing that their organizations possess unique characteristics and cultures that will impact a program of this magnitude, whether positively or negatively. They also need to conduct a thorough self-assessment to identify negative traits, and reduce, mitigate, avoid or defer risk. Sponsorship, communication and program management are a few examples of areas that banks use to test maturity before embarking on core banking renewal (see Assess Your Readiness to Avoid Core Banking Program Failure).
Market Overview
The selection of a CBS is a once-in-a-lifetime experience for most CIOs. Fully understanding this market’s dynamics and trends is vital for the success of these projects. The market continues to be stable and the trends mentioned in the previous iteration of this Magic Quadrant are relevant in this version too.
Based on data received by vendors and ongoing research with banks, Gartner has identified five key trends that are emerging and pervasive in the CBS market:
- Composable technologies are enabling customization through components.
- Core banking is moving into the cloud.
- Business functionalities are creating differentiation between tenured and new CBS products.
- Banking ecosystems are becoming the norm.
- AI use is expanding beyond analytics and customer profiling.
Trend 1: Composable Technologies Are Enabling Customization Through Components
The core banking market is adapting to significant shifts in the banking industry — from expansion of open banking regulation around the globe and partnerships between banks and nonbanks, to disruptions from AI and economic conditions that require cost optimization. Gartner observes that the key to adapting to these changes is the provision of enabling technologies to increase business agility and reduce operational costs.
Composable technology enables banks to avoid extensive software customization through the use of domain-designed definitions of components or packaged business capabilities (see Becoming Composable: A Gartner Trend Insight Report). Due to the lack of information and product transparency, banks that use conventional approaches within a CBS selection process find it difficult to assess the maturity of the composability features embedded in a product. However, the potential of composable architecture to enhance digital business agility is huge (see Quick Answer: What Is Composable Business Architecture?).
Gartner has evaluated the composability of products within the CBS market in this region by:
- Surveying banks on the four pillars of a composable architecture for CBSs, based on the Gartner taxonomy (i.e., modularity, autonomy, discoverability and orchestration)
- Analyzing CBS providers for three main indicators: product analysis, product roadmap and BIAN compliance. Each of these indicators takes into account different factors such as the percentage of code in a legacy technology (e.g., VB, COBOL), the percentage of processes or functions that are API-enabled, the percentage of software tested by automated testing tools and the percentage of variables in APIs out of the total. These factors are combined to calculate an overall indicator.
Trend 2: Core Banking Is Moving Into the Cloud
Cloud-only CBS strategies are on the rise and accelerating among technology providers and banks in the region. Cloud technology was, in the past, of deep concern to many regulators who feared the security and data leakage risks to which banks might be exposed. Also, many bank executives didn’t feel comfortable using it, deeming it inappropriate for core banking software, as they believed it too risky and unreliable. Today, these issues have eased, vendors have cloud deployment options and bank CIOs are more confident in the effectiveness of cloud security features (see Core Banking Hot Spot 2025: Moving the Core Into the Cloud).
In 2024, the concept of CBS cloud nativeness was introduced by Gartner in its end-user surveys and product evaluations. Specifically, the Gartner LIFESPAR principles (see How to Use LIFESPAR Architecture Principles to Deliver Cloud-Native Applications) have been adapted to CBS technology by focusing on five macro areas of evaluation:
- Architecture
- Product life cycle management
- Product complexity and inconsistency
- Integration points and interoperability
- Data persistence in the DBMS
Trend 3: Business Functionalities Are Creating Differentiation Between Tenured and New CBS Products
The Gartner CBS Surveys of 2023 to 2025 show that CBS products fall into one of two categories:
- Tenured products: Products sold for more than 10 years, which are the market makers (i.e., covering more than 80% of the market) and have a large installed base of at least a few dozen. These products usually have many business functionalities built and deployed to existing clients in the past.
- New products: Products launched within the last five years with a small installed base, featuring technological innovations such as a composable architecture, cloud nativeness and a more agile ecosystem. These products are often AI-ready. However, they have a limited number of installations and, therefore, fewer business functionalities.
This classification reflects the typical evolution of the CBS product, the functionalities of which had become commodities in the pre-COVID-19 era. Today, they are the differentiators between these two categories of products.
Today’s vendors can sell either tenured products or new products based on key technology such as composability, cloud nativeness, ecosystem integration and the embedded use of AI. Nonetheless, business functionalities can still be differentiators for tenured products and, in many cases, they have more extensive functionalities than new products.
To get a clear picture of the difference in business functionalities, Gartner surveyed providers on business functionalities across 11 functional areas. The survey demonstrated a clear gap between the two product categories, with tenured products getting a 4.67 global business capabilities score and new products getting a 1.94 — an actual increase in gap size compared to our last report. However, Gartner expects this gap between tenured and new products to fade away within five years.
To help bank CIOs match their business functionality requirements to vendors, Gartner has a comprehensive assessment available (see Toolkit: RFP Template for Core Banking Systems).
Trend 4: Banking Ecosystems Are Becoming the Norm
CBS offerings are evolving from autonomous islands of functionality to open, collaborative platforms. Open platforms enable the integration of a broad variety of participants, including fintechs, technology partners, bank employees, customers, regulatory authorities and other banks, within the bank’s value chain.
This integration process involves a greater use of external services, such as the cloud, rather than tangible facilities within the bank, such as owned data centers. API mediation layers and vendor marketplaces with prebuilt components and supported integration partners and standards also facilitate the creation of broader ecosystems. Banks can then increase their revenue through services to other banks (banking as a service) or as participants of digital ecosystems.
Gartner analyzed CBS vendors’ partnerships with third-party providers within the CBS ecosystem and in CBS deployments. We also reviewed the growth in the application of APIs and specific standards by vendors in their CBS projects. Bank CIOs, regardless of whether they aspire to participate in ecosystems, should evaluate providers’ ecosystem capabilities. CIOs should prepare their CBS for a more competitive banking market as open banking and embedded finance mature in the region.
Trend 5: AI Use Is Expanding Beyond Analytics and Customer Profiling
The use of AI, and specifically GenAI, is promising to revolutionize all industries. Beyond the obvious hype, the banking industry is adopting this technology and betting on it for many different use cases (see Tool: Artificial Intelligence Use-Case Library for Banking).
While most of today’s use cases are in the front office, the back office and core banking modernization also offer several fields of AI/GenAI application. CBS vendors are building these capabilities by embedding those tools in their core systems and making them available as part of their offerings. The most common use is for embedded analytics and customer profiling, but it also enables the use of GenAI for software development and maintenance.
Gartner reviewed examples of innovation and the use cases that leverage AI/GenAI fostered by the vendors. We also looked at vendors’ automated tools for migration and coding translation from old programming languages (i.e., COBOL or C) to more modern ones (i.e., Java, Python or Go language). To date, Gartner doesn’t see a rapid increase in AI capabilities by CBS vendors in the region. However, whether upgrading to a new platform or monitoring a current provider, bank CIOs must look at the use of AI in two ways:
- A vendor’s use of AI in software development to maintain and improve its CBS
- The vendor’s roadmap for AI in advancing the functionality of the CBS
Ability to Execute
Product/Service: Core goods and services offered by the vendor for the defined market. This includes current product/service capabilities, quality, feature sets, skills and so on, whether offered natively or through OEM agreements/partnerships as defined in the market definition and detailed in the subcriteria.
Overall Viability: Viability includes an assessment of the overall organization's financial health, the financial and practical success of the business unit, and the likelihood that the individual business unit will continue investing in the product, will continue offering the product and will advance the state of the art within the organization's portfolio of products.
Sales Execution/Pricing: The vendor's capabilities in all presales activities and the structure that supports them. This includes deal management, pricing and negotiation, presales support, and the overall effectiveness of the sales channel.
Market Responsiveness/Record: Ability to respond, change direction, be flexible and achieve competitive success as opportunities develop, competitors act, customer needs evolve and market dynamics change. This criterion also considers the vendor's history of responsiveness.
Marketing Execution: The clarity, quality, creativity and efficacy of programs designed to deliver the organization's message to influence the market, promote the brand and business, increase awareness of the products, and establish a positive identification with the product/brand and organization in the minds of buyers. This "mind share" can be driven by a combination of publicity, promotional initiatives, thought leadership, word of mouth and sales activities.
Customer Experience: Relationships, products and services/programs that enable clients to be successful with the products evaluated. Specifically, this includes the ways customers receive technical support or account support. This can also include ancillary tools, customer support programs (and the quality thereof), availability of user groups, service-level agreements and so on.
Operations: The ability of the organization to meet its goals and commitments. Factors include the quality of the organizational structure, including skills, experiences, programs, systems and other vehicles that enable the organization to operate effectively and efficiently on an ongoing basis.
Completeness of Vision
Market Understanding: Ability of the vendor to understand buyers' wants and needs and to translate those into products and services. Vendors that show the highest degree of vision listen to and understand buyers' wants and needs, and can shape or enhance those with their added vision.
Marketing Strategy: A clear, differentiated set of messages consistently communicated throughout the organization and externalized through the website, advertising, customer programs and positioning statements.
Sales Strategy: The strategy for selling products that uses the appropriate network of direct and indirect sales, marketing, service, and communication affiliates that extend the scope and depth of market reach, skills, expertise, technologies, services and the customer base.
Offering (Product) Strategy: The vendor's approach to product development and delivery that emphasizes differentiation, functionality, methodology and feature sets as they map to current and future requirements.
Business Model: The soundness and logic of the vendor's underlying business proposition.
Vertical/Industry Strategy: The vendor's strategy to direct resources, skills and offerings to meet the specific needs of individual market segments, including vertical markets.
Innovation: Direct, related, complementary and synergistic layouts of resources, expertise or capital for investment, consolidation, defensive or pre-emptive purposes.
Geographic Strategy: The vendor's strategy to direct resources, skills and offerings to meet the specific needs of geographies outside the "home" or native geography, either directly or through partners, channels and subsidiaries as appropriate for that geography and market.