Financial Firms Do the Coding Limbo: How Low Can We Go?

As financial firms move more of their technology to private or public cloud to support new mobile versions of existing apps, they are increasingly turning to low-code solutions rather than writing all the code in house.

In its global survey of developers, Forrester noted 23% used low-code platforms in 2018 and another 22% planned to use low-code within a year or so.

Low code replaces hand-written code, with drag-and-drop visual development tools, components, and APIs. Forrester listed the leaders in low code as Microsoft, OutSystems, Mendix, Kony, and Salesforce.

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“By choosing smaller (cloud) services with narrower scopes and fully functional APIs as building blocks and by breaking solutions into very small pieces, companies can now select services that they don’t need to customize,” wrote OutSystems founder and CEO Paulo Rosado in InfoWorld.

"Low-code technology also helps to level the playing field," said Omar Arab, Vice President of Corporate Business Development for VeriTran, a company focused on driving digital transformation through its low-code platform.

"Platforms like these enable large and small institutions alike to easily modernize the way they develop enterprise apps in a fraction of the time of hand coding, often with higher quality. Also, low-code platforms can extend and update existing applications that need some freshening up, leaving the existing business logic in place,” he added.

OutSystems: Portugal’s First Unicorn 

When AXA needed to offer its brokers electronic access instead of making them use an overburdened call center, it used OutSystems to get a web-based portal — eServe — up and running quickly. Soon after, it offered an expanded version for customer self-service.

“OutSystems has been around for 17 years and was a pioneer in low code before the term was invented,” said Steve Rotter, the company’s chief marketing officer.

In 2018 it announced a $360-million investment from KKR and Goldman Sachs, giving it a valuation well over $1 billion, making it Portugal’s first unicorn.

Forrester wrote that “OutSystems keeps pushing the boundaries of low-code platforms — into apps that process device readings and other streaming data, into AI, and into core business record-keeping systems.”

Kony: Low Code for Finance 

A competitor in financial services is Kony, which provides applications specific to finance such as mobile phone banking and onboarding. Banks often layer Kony solutions on top of dated legacy core banking software from firms like FIS and Fiserv. (Temenos announced on Aug. 28 that it was buying Kony for $559 million and an earn-out of $21 million.)

Tom Hogan, CEO of Kony and now CEO of Temenos North America, said Outsystems is a competitor with Kony’s Quantum, a cross-industry platform for B2B, but not with its retail banking front end, DBX.

‘We never see them in DBX; their sweet spot is more B2B that doesn’t require the high fidelity user experience of B2C,” he said.

Rotter said that OutSystems works with companies across industries, including Schneider and GE.

Scarcity of Programming Talent Amplifies Attractiveness of Low Code

The skeptical conversation about low code vs. traditional development is fading, said Rotter, because firms can’t find enough developers. “IT managers have no choice.”

Michael Aldred, managing director at the UK online bank thinkmoney, said it was impossible to recruit enough good developers in Manchester to do traditional coding.

“Low-code platforms are quick to learn,” he said. “Several of our developers joined us from non-coding backgrounds, and now they’ve mastered the OutSystems platform and produced great results.”