Sterling Bank, a prominent Nigerian financial institution with a market capitalization of ₦115.16 billion, has announce the availability of its newly developed core banking application software, SEABaaS, for licensing to other financial institutions and fintech companies.
As part of its strategic initiatives to optimize operational efficiency, Sterling Bank has successfully created SEABaaS to meet the evolving needs of the banking industry. By leveraging its in-house expertise, Sterling Bank have developed a robust and scalable core banking solution that addresses the challenges faced by financial institutions in delivering seamless banking services.
In line with this strategy, Sterling Bank have recently presented SEABaaS to MoMo, the Mobile Money service of MTN. This engagement underscores its commitment to fostering collaboration and innovation within the financial sector. By licensing SEABaaS to other entities, Sterling Bank aim to contribute to the overall growth and advancement of the banking landscape.
Sources indicate that Sterling is also targeting fintech companies, as SEABaaS was designed to provide the agility typically associated with fintechs. The bank has taken a more innovative approach compared to its peers, introducing asset financing products, enhancing the user experience of its banking app, and launching Alternative Bank, a non-interest banking option. With a range of products available and more in the pipeline, Sterling aims to persuade fintechs that prioritize speed and innovation that SEABaaS is an ideal solution.
Neither Sterling Bank nor MTN MoMo has responded to requests for comments.
In addition to fintechs, Sterling Bank seeks to attract business from other banks. With tier-1 banks expected to allocate ₦80 billion for licensing core banking software in 2024, SEABaaS could present a more cost-effective alternative. However, insiders suggest that convincing these banks may prove challenging.
"Most banks are likely to hold off until they observe how SEABaaS performs during year-end operations," one source knowledgeable about banking technology shared with TechCabal. The year-end period is critical for banks, as they must balance accounts and reconcile transactions in preparation for the upcoming year.
The SEABaaS software was jointly developed by Bazara Tech Inc, Peerless Technologies, and another undisclosed entity. The precise investment made by Sterling in the software's development remains confidential; however, it is understood that the bank prioritized localizing expenses. Customarily, banking software solutions like Finacle and Temenos are priced in U.S. dollars. This novel offering is anticipated to attract interest from tier-2 banks seeking cost reduction strategies.
SeaBaaS represents a state-of-the-art core banking system that leverages innovative technologies, including microservices architecture, cloud-native infrastructure, open APIs, and AI-driven analytics.
This advancement marks a significant progression in technology, aimed at improving customer experience through a strong, resilient, and secure framework.
For Sterling, adopting SeaBaaS transcends a mere strategic choice; it is a transformative initiative that benefits the broader Nigerian economy. By selecting a platform developed locally, we enhance Nigeria’s balance of payments and promote the generation of intellectual property domestically. This initiative positions Nigeria as a net exporter of technology, fostering innovation, creating employment opportunities, and reinforcing our technology ecosystem, which is essential for sustainable economic development.