Accenture’s 2026 Banking Trend Report: Legacy Tech is Consuming 70% of IT Budgets
- Legacy systems swallow IT budgets, diverting funds from innovation, modernization, and AI-ready capabilities
- Banks spend most tech dollars just keeping outdated platforms operational and barely compliant
- Modernization reallocates budget from maintenance to strategic growth, customer experience, and operational efficiency
One major factor holding the banking industry back is undoubtedly its reliance on outdated legacy technologies. These technologies tend to be inefficient, perform worse than the latest innovations, and -- perhaps more importantly -- cost more than to maintain.
How much, you may ask? Well, according to the Accenture's 2026 Banking Trend Report, nearly 70% of IT budgets are being consumed just by maintenance of legacy systems.
Digital channels, mobile apps and online platforms became the priority, but the foundations supporting these experiences have not kept pace. Most banks took a lower-cost shortcut, layering new capabilities on decades-old core systems instead of replacing them. The result? Nearly 70% of IT spending now goes toward maintaining these systems and meeting ongoing regulatory demands, leaving little room to support innovation and growth.
The report finds that over the past 15 years, banking technology costs have increased at roughly four times the rate of banking revenue, with the majority of that spending dedicated simply to maintaining existing systems. In fact, since 2017, software costs have grown by an average of 8% per year.
Understanding the Challenge
For years, underinvestment has left many banks struggling with significant technology debt and rising operational costs. While these systems remain reliable, their rigid architecture makes modernization and integration with newer technologies difficult, ultimately limiting innovation.
The report highlights artificial intelligence as a key pathway to modernization. AI-driven development, composable architectures, and greater adoption of open-source technologies can help banks reduce complexity, accelerate software development, and lower the cost of maintaining legacy infrastructure.
Unfortunately, while 80% of retail-banking CTOs report that technology change has intensified this year, only 28%, according to Accenture, feel fully prepared for the disruption ahead. Those financial institutions are faced with the following challenge:
In the next few years, banking CIOs and CTOs face technology decisions that will determine whether their banks thrive or fall irreversibly behind in the decade ahead.
The Future of Banking Technology
It's no secret that the banking industry has passed the inflection point where AI technologies are no longer speculative but a necessity. However, many financial institutions have underinvested for years -- even decades -- relying on legacy core technologies and failing to adopt new technologies due to their inability to integrate.
However, banks that have taken on the project of updating to the latest core platforms are reaping benefits. These technologies are able to integrate the latest innovations through methods like API.
Check processing is one major example. Legacy core platforms leverage outdated OCR technologies that achieved 80% accuracy and read rates. While this performance was standard 10+ years ago, today's AI technologies are achieving over 99% accuracy and read rates. These technologies are directly integrated within core platforms, lowering the cost of maintenance.
As noted by Accenture:
Banks that cling to old core systems and legacy vendors will likely face rising costs, slower innovation and greater exposure to operational shocks. Those that simplify and modernize their architecture will lower run costs and turn IT into a source of agility, resilience and advantage.