Bank Syariah Indonesia (BSI) has completed one of its largest technology transformations since its creation in 2021, as it builds the infrastructure to support a substantially larger Islamic banking franchise. BSI migrated its core banking platform from Temenos R10 to R24 on 16 May 2026. The programme involved about 1,500 personnel across functions and followed upgrades to digital channels, ATMs and other parts of its technology infrastructure. The immediate challenge was scale. Saut Parulian Saragih, SEVP IT Development & Operations at BSI, said the 2021 merger that created BSI from Bank Syariah Mandiri, BRI Syariah and BNI Syariah produced an institution substantially larger than the technology estates of the three predecessor banks had been designed to support. The core now connects with more than 70 applications. BSI serves more than 24 million customers and is targeting 40 million by 2030 as it pursues its ambition to become one of the world's five largest Islamic banks. Its 2030 ambitions also include assets of IDR1,000 trillion ($60 billion) and return on equity above 25%. Those targets provide a broader financial context against which the technology investment will ultimately have to contribute. The bank considered alternative platforms but decided to upgrade its existing Temenos core. Saragih said change-management risk was an important consideration for an institution with about 16,000 employees and more than 1,100 branches. The programme involved several technology and implementation partners. Saragih said Temenos provided the product expertise needed to migrate a heavily customised R10 environment to R24, while Systems Limited acted as systems integrator and supported the integration and technical work. Deloitte provided project-management support, bringing experience from other large implementations, while Red Hat supplied the underlying infrastructure through OpenShift. The decision reduced the amount of organisational change accompanying the technology migration. It did not remove the more important business test: whether the additional capacity can translate into growth and deeper customer relationships. Reliability matters to distribution The most immediate change since the migration has been improved reliability. Saragih said monthly customer additions exceeded 200,000 consistently in the three months following the migration, compared with reaching that level in only one or two months during a typical year previously. He associated greater system availability with increased confidence among customers and employees, although customer growth cannot be attributed to the core migration alone. BSI subsequently reported availability of 99.99% across its channels following the migration. It said less than 10% of the upgraded system's capacity was being used, leaving substantial headroom for customer growth and additional digital services. The employee effect is important. Saragih said branch staff are more willing to offer products when they have confidence that the systems supporting them will work reliably. Technology reliability therefore affects more than transaction processing. It can influence distribution and the willingness of frontline employees to sell. Saragih also sees a larger structural opportunity for Islamic banking. Before the merger, some Muslim customers chose conventional banks even when they preferred Islamic products because smaller Islamic institutions could not always provide comparable products and service. Saragih described this as structural rather than simply latent demand: the preference exists, but customers will not necessarily act on it if the service proposition is weaker. A larger BSI with more reliable infrastructure and a broader product range potentially changes that trade-off. Digital banking extends the Islamic banking relationship BSI does not expect digital channels simply to replace its branch network. Saragih said straightforward transactions will continue migrating towards digital channels, while wealth management, priority banking and more complex products will continue to require human interaction. Its BYOND by BSI application also extends beyond conventional banking functions. Saragih cited prayer times, Qibla direction and charitable donations alongside financial services. That potentially gives BSI more opportunities to engage customers around financial, social and religious needs, although engagement only becomes commercially significant if it results in deeper and more productive relationships. For institutional customers, BSI operates BEWIZE, its wholesale digital and cash-management platform. The two channels reflect the broader architecture Saragih described, routine transactions moving increasingly to digital platforms while branches and relationship teams remain important for more complex needs. Open banking provides another route. Saragih said BSI works with more than 3,400 partners through 25 open banking application programming interfaces, with another 22 partners in the pipeline. Transaction frequency through these connections increased by almost 180% year-on-year and transaction volume by about 240%, he said. The bank is extending these relationships into sectors including education, connecting payments, payroll and other banking services with universities. The opportunity is therefore not customer acquisition alone. BSI can potentially capture a greater share of activity around existing customers through a broader Islamic financial ecosystem. AI depends on more than the core Core modernisation is also intended to remove some of the constraints on BSI's use of artificial intelligence (AI). Saragih said the bank had previously been cautious about becoming more aggressive in AI because of limitations in its old core. The new platform is moving BSI closer to near-real-time data availability, which it regards as important for broader AI deployment. BSI already uses models for next-product-to-offer recommendations, online onboarding and facial recognition. Saragih said automated onboarding was important to sustaining current customer acquisition volumes because requiring those customers to visit branches would constrain growth. But his requirements for scaling AI extend well beyond the technology platform. He identified four dependencies: data, computing infrastructure, governance and people. Data has to be complete and consistently defined as well as credible and traceable. BSI currently expects infrastructure supporting these AI applications to remain on-premises as it seeks to protect customer data. Governance becomes equally important as employees gain access to generative AI tools. Staff need to understand what information can be used and where, particularly when public AI services could expose confidential data. AI readiness therefore cannot be measured simply by whether a bank has upgraded its core or acquired additional computing capacity. Security moves earlier in development BSI is also changing where security enters its technology-development process. Saragih said security teams are now involved across application, infrastructure and data architecture from the beginning of projects rather than primarily testing systems towards the end. Penetration testing remains part of the process, but identifying vulnerabilities earlier should reduce the number of findings at the final stage and shorten the path to production. The approach becomes more important as BSI increases its digital scale and connects to more external partners. Saragih said the technology organisation ultimately needs cloud-native and AI-ready infrastructure, more predictive cybersecurity, adaptive governance and people capable of working with the changing technology environment. But BSI still measures the business against familiar banking outcomes. Saragih cited revenue, cost-to-income and asset quality among the measures against which it compares itself with conventional institutions. Capacity is only the starting point The core migration has removed an important technology constraint created by the scale of BSI's 2021 merger. But additional capacity is not a business outcome by itself. The next test is whether BSI can convert improved reliability into sustained customer growth, deepen relationships with customers seeking Islamic financial services and use its digital ecosystem and AI capabilities to generate stronger revenue and productivity. Its opportunity is potentially larger than simply serving more customers on a newer core. BSI is trying to combine the scale of a large national bank with a differentiated Islamic proposition across digital channels, branches and partner ecosystems. That will determine whether the migration was primarily a necessary infrastructure upgrade after the merger or the foundation for BSI's next phase of growth.
