• Aaron Silva, CEO and Founder at Paladin fs and The Golden Contract Coalition


• 17.06.2016 12:15 pm
undisclosed

The Hard Truth

I stand for the health and vitality of community banks and have watched for too long as the core and IT vendor oligopoly enjoyed by Fiserv, Fidelity, Jack Henry and the likes have gone unchecked, putting the entire community banking industry at great risk. Unable to develop and deploy the same affordable, cutting-edge, customer-facing services as those produced by larger national banks, community financial institutions have been left at the mercy of their core and IT providers.

So, What Can We Do?

After almost a decade fighting the good fight and working with banks to address their contract and monetary savings goals with Paladin fs, I realized that the oligopoly is just too powerful to take down alone. Now I’ve teamed up with Pillsbury Winthrop Shaw Pitman, LLP, the most hard-hitting  most successful IT supplier negotiations firm in the world, and together we’ve built the Golden Contract Coalition (GCC) to tackle vendors’ uncontrollable terms and bad contract deals that our community banks and credit unions fall victim to, time and time again.

What is the GCC?

An alliance of community banks, credit unions and key players from within the banking community, the GCC is charged with addressing core vendor contract disparities from one institution to another, and aims to level the negotiation playing field by creating a fair, standard, right-sized agreement between community financial institutions and their core and IT vendors.

By stripping the excessive legalese and self-serving conditions from core and IT agreements and pricing, and dictating the master commercial terms and legal conditions by which all core and IT providers must abide, the Golden Contract is able to manufacture unprecedented levels of leverage by pooling the combined contract value found in large groups of community banks and credit unions. With more than 40 members already on board, these collective bargaining methods equip smaller institutions with the same negotiating power as the large, national and multi-national banks, allowing them to pass on cost-saving benefits to their shareholders and to consumers.

For the first time in history, the GCC puts the power into the hands of institutions, giving them the protection they need to challenge the core and IT vendor oligopoly and end the era of underperforming IT functionality, unfavorable contract terms and one-sided deals. Call it a collective, a union, a consortium, a buying group, but whatever the name may be, it will finally create a level playing field between the industry and the suppliers.

Where Will the GCC take the Banking and Credit Union Industry?

The fact is, we’re not out for blood; we’re fighting for an industry that offers fairness and equity to financial institutions of any size. We’re creating a just, master contract that will work as the basis for all institutions, will includes service levels that explain step-by-step what the product will do functionally, and will provide real enforcement mechanisms that even smaller institutions can execute. 

Whether the oligopoly knows it or not, the industry is unhappy with the quality of the products, services and value they are currently paying for, and there is an alarming suspicion that bankers are being taken advantage of economically. It’s time to change the game, once and for all – and the GCC it making it happen.