EXCLUSIVE: “From Tomorrow to ‘Now!'” – Will Moroney and Mick Fennell, Temenos in ‘The Fintech Magazine’

As legacy systems drag on profitability, and fintech challengers reshape expectations, Temenos redefines modernisation, putting banks back in control of their future. Will Moroney explains how

Three decades after the industry first began talking about modernisation, banks are finally doing it, and doing it fast. Artificial intelligence is no longer a promise on the horizon but the accelerant in the engine. The ‘tomorrow’ approach has given way to a ‘now’ culture, and Temenos finds itself in the middle of what Will Moroney describes as a ‘perfect storm’ of transformation: the pressure to modernise – again.

Back in 1997, when Moroney, now Chief Revenue Officer at Temenos, first entered the game, it was Y2K that spurred the urgency to renew.

“Then came digitisation, then big data,” he recalls. “Now, AI is what’s pushing the requirement to modernise.”

But this time, the pressure isn’t just technological, it’s financial, too. Legacy systems are now an active drag on profit. According to recent figures, banks in the UK now spend an estimated £3.3billion each year on maintaining outdated core systems – roughly a quarter of their total IT budgets. And across global institutions, transformation costs are rising while returns are flattening.

The industry’s compound annual revenue growth sits around four per cent, while non-interest income has fallen nearly 20 per cent per asset over the past five years, according to The True Cost Of Legacy Systems: A Deeper Dive Into Banking IT Modernisation report from Digital Bank Expert. At the same time, fintechs are eating into banks’ income potential and their customer relationships. The result, says Moroney, which they could arguably have seen coming, is ‘modernisation under pressure’.

“We’re hearing it everywhere,” he explains. “Banking leaders must show they can work with AI, not just talk about it. That means modernisation under pressure. It means modernisation that delivers impact now.”

AI readiness: the new starting line

For all the noise about chatbots and digital assistants, the real story in bankingAI is happening behind the scenes – in data management, infrastructure, and regulatory compliance.

“There’s definitely an appetite for understanding what AI brings to banking technology,” Moroney says. “But, crucially, there’s also a growing understanding that it’s not just about using AI in the customer layer. That might only be 10 or 15 per cent of the capability. The rest is internal – fixing errors, cleaning data and reducing false positives when protecting against financial crime.”

The hard truth, he adds, is that most banks aren’t ready.

“Once they see what AI can do, they realise they don’t have the data structure, the infrastructure, or the regulatory clarity to support it. AI readiness has become the first big topic in every client conversation.”

This readiness gap comes at a time when technology spending has never been higher. Yet revenue is falling: despite average tech investment growing by nearly nine per cent a year, bank productivity has declined by around 0.3 per cent annually since 2010, according to The Financial Brand’s analysis, which references figures from Boston Consulting and McKinsey.

The industry is still weighed down by compliance complexity and legacy debt. This is why, Moroney says, ‘banks can’t afford to wait for perfect conditions anymore. Artificial Intelligence is exposing every inefficiency they’ve tolerated for too long’.

At this year’s Temenos Community Forum (TCF) in Madrid, banks, regulators and technology partners debated not just AI’s potential, but how to introduce it responsibly. As Santander’s José Manuel de la Chica put it at the time: “We’ve moved from deterministic to probabilistic systems. The agent is the new API, but there must always be a human in control.”

No patience left for legacy

If patience was once a banking virtue, it’s now a luxury few can afford. After nearly three decades of talk about core modernisation, executives are understandably losing interest in the idea of five-year journeys and want to see what can change this quarter.

“There’s more of an interest in ‘how can I have an immediate impact in one of my business lines, in the next six months?’,” says Moroney. “And ‘can we look at a minimum viable product that delivers real results, and then build from there?’. The market’s just not waiting anymore.”

The numbers bear him out, too. The KPMG study, State Of The Banks, from earlier this year, suggested UK banks’ return on equity will drop from roughly 13 per cent in 2023 to just eight per cent by 2027 – equivalent to £11billion in lost annual profit. Meanwhile, new digital challengers and embedded-finance players are siphoning deposits and transaction revenue at record pace.

This demand for immediate, measurable value is also reshaping the vendor-client relationship. Banks want partners that can deliver in fast, iterative bursts, and vendors who will share accountability for outcomes. Temenos’ response has been to re-engineer its own organisation around the full customer lifecycle – uniting sales, delivery, customer success, and partner management under one CRO-led structure.

“When we started that transformation, the goal was simple,” Moroney says. “Put the customer at the centre of everything we do, from first touchpoint to renewal.”

Modernisation for the age of AI

At TCF 2025, Temenos showcased what it calls ‘modernisation with immediate impact’. By that, it means modular architectures, Cloud-native components and AI-assisted delivery tools that cut months from project timelines. In the first half of 2025 alone, Temenos supported more than 150 go-lives with clients globally – a figure the company sees as proof of its ability to execute at scale.

Barb Morgan, Temenos’ Chief Product & Technology Officer, described the company’s product philosophy shift succinctly: “Build less, but smarter. Focus on what really makes the dial creep.”

That approach is driving a whole host of new collaborative initiatives, including a Design Partner Programme, inviting banks to co-create products and prototypes that solve immediate pain points. And AI isn’t just something Temenos enables for clients; it’s also using it internally to accelerate its own delivery. From analysing legacy code to automating testing cycles, AI is speeding up execution and, crucially, freeing people up to focus on higher-value work.

From vendor to ecosystem partner

Perhaps the biggest change is not in technology but in mindset. Banks no longer want a single vendor to ‘do everything’. They instead want ecosystems – open frameworks where specialised partners collaborate.

“Instead of looking for one big partner that will do everything, banks are asking ‘howdo we build an ecosystem?’,” says Moroney. “That’s where we fit in – proven technology, domain expertise and a hybrid delivery model that brings the right people together.”

It’s an idea rooted in the philosophy of Temenos founder George Koukis, who once said: “Profitability is the consequence of happy clients.” That ethos – that great technology must serve human needs and trusted relationships – still defines the company’s culture. Or, as one TCF speaker, Dr Jonnie Penn of Cambridge University, reminded TCF 25 delegates: “Fortune will favour the collaborators.”

The era of immediate impact

The future that Temenos envisions is one where banking transformation happens continuously, not cyclically. AI has become the catalyst for that, exposing the limits of legacy systems, but also offering the tools to finally transcend them. For the first time in 30 years, the technology exists to do in months what once took years – and the economic reality means banks can’t delay.

“Modernisation used to be about preparing for tomorrow,” Moroney reflects. “Now it’s about surviving today.”

How Temenos Payments is powering the ‘now’ economy

Nowhere is the Temenos philosophy of ‘modernisation with immediate impact’ more visible than in its payments division. Under Business Line Director, Mick Fennell, the company is reshaping the payments landscape for banks and non-banks alike – from start-ups chasing market entry to incumbents weighed down by legacy debt.

“The volumes keep climbing, up seven per cent globally every year, and the diversity of payments is exploding,” Fennell says. “Our customers are processing instant, cross-border and batch payments across different clearing systems, all under tightening regulation. They need a single, seamless way to manage that complexity.”

Temenos’ answer is its Money Movement and Management platform, a pre-integrated environment for payments, accounts, risk, and treasury. Built on the Temenos Banking Platform, it offers deep functionality across more than 100 markets, deployable in the Cloud, on-premise, or as Temenos software-as-a-service (SaaS). It’s designed to cut time-to-market dramatically, whether replacing outdated systems or enabling fintech-speed innovation.

“We talk a lot about being seamless,” Fennell says. “You can’t have a seamless experience without integrated platforms. Customers expect low latency, instant execution and immediate feedback – and that means accounts and payments have to work together in real time.”

AI runs through this platform like ‘soaked fruit through a Christmas cake’, as Fennell puts it.

Temenos has infused AI models throughout the stack, reducing fraud false positives from six to under two per cent; automating payment repairs and embedding co-pilots powered by Microsoft and NVIDIA to help users create products faster through natural-language commands.

It’s all part of what Fennell calls the ‘attention-economy of payments’, an age where both banks and their customers demand instant outcomes.

“We’re helping institutions industrialise and modernise their capabilities,” he says. “There’s no patience left for legacy debates — it’s about delivering impact now.”

This article was published in The Fintech Magazine Issue #37, Page 8-10

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