Most community banks view core conversions as gambling — they could make an all-in bet to convert and transform their institution or play the hand safe and stay with the legacy solution. While the potential risks can be high, financial institutions should approach core modernization as a competitive and strategic long-term play.
At $4.3 billion PeoplesBank, our decision to modernize was driven by opportunity. As a mutual subsidiary of PeoplesBancorp in Holyoke, Massachusetts, we wanted to serve customers better, enable our staff to work more efficiently and position ourselves for future growth. We viewed core modernization as a strategic advantage to be unlocked.
In 2020 we partnered with Nymbus for modern core technology to launch our digital brand, ZYNLO Bank. In less than five years, ZYNLO has grown to close to $200 million in deposits demonstrating the tangible benefits of modern banking infrastructure. We saw how streamlined operations, enhanced customer experiences and improved efficiency were possible with Nymbus’ technology stack and made plans to bring these capabilities to our entire organization.
ZYNLO proved that contemporary core technology could deliver measurable improvements in both operational efficiency and customer satisfaction, and it also served as a window into opportunities that were not possible with our legacy system. This gave us the confidence to commit our entire institution to the same foundation.
The easiest path would have been to simply recreate existing processes on the new platform. Instead, we challenged every assumption, asking, “How should we do this?” and “Does this still serve our customers?” The result was a road map to streamlined operations that would make sense for both our staff and our customers.
Communication Is Your Secret Weapon
Our most critical finding: Internal communication is just as, if not more, important than external communication during a conversion. Your staff is your nerve center for communicating outward. They need to know more than anyone else. We made business unit owners active participants and stakeholders, not just recipients of change.
This created genuine enthusiasm for change , leading to true employee engagement. In an industry where major system changes typically trigger departures, our people stayed and became advocates because they had ownership in the outcome.
Customer communication proved far less predictable. Despite 18 months of data cleanup, enrollment testing and external communication about what customers could expect, we faced surprises. More than 19,000 customers enrolled on day one — exceeding projections — but some customers inevitably experienced challenges and frustrations, making rapid response critical.
Conversions are like snowflakes. You recognize one when you see it, but no two look alike. You cannot predict every customer reaction or system hiccup, regardless of preparation. The solution is over-communication and agile response. We knew we could not cover every scenario, and that unexpected issues would emerge. Digital banking enrollment became our biggest challenge and required real-time adjustments to our communication strategy and support processes.
Modern Systems Transform Capabilities
With ZYNLO Bank, products that previously took months to launch could be deployed in weeks. Real-time data insights replaced the cobbled-together reporting systems we’d relied on. But the transformation went deeper than speed and analytics — ZYNLO’s success triggered an important mindset shift.
Our legacy system had trained us to say “no.” Countless board meetings and strategic sessions ended with the frustrating reality that good ideas couldn’t be executed because our core couldn’t support them. The new platform flipped this dynamic. Conversations shifted from “We can’t do that” to “What should we try next?”
We were surprised by how quickly our staff embraced the change. We had braced for months of training challenges and help desk calls. Instead, the system’s intuitive design eliminated our need to provide extended post-conversion support for our front-line teams after one week. When technology enhances rather than constrains your team’s abilities, adoption becomes natural rather than forced.
Five Keys to Success
For community banks considering similar transformations, five principles proved essential.
1. Test everything through pilot programs before risking your entire institution.
2. Rethink processes completely rather than simply replacing technology.
3. Invest heavily in continuous, participatory communication.
4. Prepare for surprises by building flexibility into your approach.
5. Choose platforms that enhance your team’s capabilities for the long-run and not just the short-term.
Success comes from managing risk intelligently through deliberate preparation and proven partnerships. While we’ve developed what we needed to open the doors, the real work of continuous improvement and adaptation still lies ahead. Financial institutions that view transformation as a competitive advantage waiting to be unlocked will thrive.
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