What Code Do Banking Systems Run On?

Coding is needed for banks to run their systems fluently and quickly. They can handle large amounts of data in such a short time with excellent efficiency. Some coding languages banks use are Java, Python, C++, Scala, and more. Ultimately, coding is essential, involving analysis skills, problem-solving, and more. This is what banks deal with frequently.

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All these languages work well, but the most used one is Java. Banks' most used coding language is Java because of its security and portability. Java has many safety features, which is crucial for banks since security is most needed. This language’s components provide memory safety features that help mitigate vulnerabilities from programming mistakes. Not only is Java’s security and portability, but banks also use Java since it has accessible applications and lower costs.

Benefits of Java

Java is a fantastic programming language for many things, like making websites, game development, AI, and especially dealing with big data. The benefits of Java are that it’s cheap, secure, simple, supports portability, and much more.

Being portable, you can use Java on any programming language without problems. Companies that use Java can easily use it on any of their machines, reducing maintenance costs. Overall, the language is simpler than other languages like C and C++, Java is a straightforward language to learn and use anyone.

Java’s backward compatibility is excellent since you can use the same coding in the older or new versions of Java without any issues. Banks can quickly rotate to Java’s new application without errors.

Security

Banks need to protect their customer’s financial and personal information, so they need to use a secure language, Java. Java has built-in support with data encryption and a secure network database and communication. Having that will prevent hackers from gathering this information which is great for banks. As a result of its security, this language has been the top platform for banks to use for decades now, and Java’s top-notch and object-oriented features prove why.

Object-Oriented

The benefits of object-oriented are its reusability, code maintenance, security, and more. This helps design programs with objects and classes or even entities. Its reusability allows users to write only " once, use it multiple times.” That is helpful for banks since repetition is involved.

Code maintenance allows bank systems to easily modify or maintain codes as new objects with differences from the existing regulations. Banks can work with that code and rework it as often as they like. Additionally, the security of object-oriented things is that it hides that data automatically and use filters to limit exposure.

Multithreading

Java also offers multithreading; it uses two or more threads so it can have maximum utilization of the CPU. This can be helpful in banking, where they can see who withdraws what and see their balances. Here is a video of the concept of multithreading.

Synchronized multithread executes faster than coding without multithreading. It can do other productive things until the thread gets the key from the scheduler to get into the synchronized area. This will be extremely helpful for banks for the banking transaction part. Therefore, it will allow banks to process things faster than before.

Disadvantages of Java

Although Java is a fantastic programming language, it still has some downfalls. Java's performance is much slower than other coding languages; even if Java is cheap, the cost is high due to its memory and processing needing higher requirements, making prices slightly more elevated.

Another disadvantage is that Java is too complex, and it takes a lot of coding to code something, and with other languages, it could be done more efficiently.

Although Java is considered an old-fashioned language, it has allowed other programming languages to improve. Businesses would rather have fewer lines in a code with the same results than another code with many lines. That is one of the significant disadvantages of Java, needing to be more verbose to code something, which could hinder people trying to learn Java.

Scala

Scala, another programming language that banks use for their systems, has an exact syntax, meaning you must have a specific set of words and order to code correctly. With this strictness, coders can effectively communicate well with the computer.

Furthermore, you can use Scala to execute Java code; it’s fault-tolerant and has high concurrent systems. Scala also works well on batch data processing, analysis, and distributed data processing. Here is a video of the concept of Scala and how it works.

Banks use Scala mainly to help with retail banking and to strengthen their communications and system overall. With Scala’s analytics, banks can be informative about their customer’s patterns, preferences, and behavior. That allows banks to offer personalized services to their customers for a better experience overall.

Scala is for massive projects with many needs for multiple resources, so that bank systems would work well with this coding language. Ultimately, Scala has many benefits for bank systems and some negatives.

Benefits of Scala

Some benefits of Scala are that it is more concise and readable, easy to code and understand, has functional programming that lets you see the problem from many different angles, and has external libraries.

Java needs more lines of coding to run its program, while Scala takes less time and less coding to run its program. Since banking involves many repetitive processes, Scala also has concurrency to help parallelize many tasks.

Here is an example from Matt Hicks comparing Scala and Java with having a user class returning a list of all products:

Java

public List<Products> getProducts() {
List<Product> products = new ArrayList<Product>();
for (Order order : orders) {
products.addAll(order.getProducts());
}
return products;
}

Scala

def products = orders.flatMap(o => o.products)

With many reasons to use Scala for banking, it has many downsides. Scala looks simpler than Java and, once again, needs to be more verbose. The coding for Scala is simpler to read, and people would instead look at that than Java’s.

Disadvantages of Scala

With many positives and likeability from banks, the downside of it is that it has too many features. Having too many features will make the language harder and longer to learn to be decent at the language. Scala is also verbose with many symbols, existential or dot types.

Additionally, Scala has limited backward compatibility, referring to an older version of something. An example of backward compatibility is that an Xbox Series X and Xbox 1 can play with Xbox 360 games that are older. However, since it takes longer to learn Scala, there will be fewer people familiar with this language, thus making banks prefer Java for their banking systems due to more people knowing Java than Scala.

Banks

Some of the largest banks use Java for their banking system. With Java, it can provide banking features like funds withdrawal, funds deposits, and more. Chatbots, fraud detection, trading and investments, and mobile wallets are all used by Java. Its reliability, Java will always be consistent for banking systems, and its platform independence can run great on IOS, Android, Windows, and more.

Chatbots are common on all bank systems, and you may have run into them too while browsing the internet. The purpose of chatbots is to improve the online customer experience so banks don’t have to hire real chat support.

Fraud detection makes it that it detects fraud in credit card or bank account activities. Java is used in trading and investments because it has the best rapid development, and most electronic trading apps use Java.

Mobile wallets are common in all banks now. Additionally, the developers of mobile wallets use Java-based algorithms and AI to help people make crucial decisions when spending money.

Without Code

No-code is a new thing that requires less manual coding than a code/ low-code. This revolutionary thing is where non-programmers can develop a system or app without a single code. It is super customizable, has many solutions driven by any idea, and is secure. No-code will change the jobs of IT and businesses like banks since there are high demands to offer digitalized things for their consumers.

If banks adapt to this, they should migrate their data to these web applications to be more versatile for their new and old customers. Traditional software development and developers are getting more expensive over time, and having a no-code platform will help banks get into the market quicker. Developing can take months or years to code and test their product, but having no code will be quick and easy.

With Code

Banks already have coded systems on their banking system that is working well. They have been running Java in their systems, which has already been a thing for over 25 years, and going. Banks has been the early adopter of Java, and they were hesitant to change due to its stability and security. Also, they would instead stick with what works already and then try and change to a new code that can require lots of experimentation.

Coding can help any industry and can make our lives less stressful. You can code things and make them repeat, which would be faster than manually repeating them repeatedly. Here’s an example of using Java to create a banking application. This banking application has features for depositing, withdrawing, and more. It can also display account details and search your account by number.

Coding Java has networking capabilities, making coding easy for programmers and those using it, which is essential for banking and financial institutions. Java itself has a large active community and has many regular updates so banks can be up to date with its technology.

Coding Knowledge

Banks like JPMorgan Chase, Goldman Sachs, and Citigroup are making their investment bankers learn how to code. Citigroup people were introduced to a 3-day Python introductory to learn how to code and use their knowledge to help the company. JPMorgan Chase spends about $10.8 billion yearly on technology, more than any other wall street group. The head of JPMorgan Chase claims that coding is for anyone who wants to have a competitive company in the 21st century.

With schooling in Python workers, they can understand more about how coding benefits banking systems.

All of this can improve banking systems and help banks have workers with background knowledge of coding.

Takeaway

Coding makes it possible for humans and computers to communicate effectively. Banking deals with large amounts of numbers daily with many problems to solve. With coding, banks can record the transactions that are happening every single time it occurs. Memory management will be easier with coding due to our technology of saving it and through automatic garbage collection, which Java has.

Regardless of its downsides, Java is the best choice for banks to use for their system. Again, banks have been using Java for their system for more than 25 years now and still going.

Coding is essential in many industries. We need it to catch up on what we have today. Banks use older coding languages like Java since it's consistent and works well. With Java’s flexibility and simplicity, this language is good enough to be used in many big projects for companies. In general, coding makes our lives more accessible for us to use, and banking, data analysis, and money handling will be easy to deal with.