Scrolling through job boards for developers you often find very highly paid jobs for COBOL developers. But COBOL is a dead programming language. So what is the catch? Today we are dominated by cutting-edge programming languages and innovative technological advancements, so the enduring presence of COBOL (Common Business-Oriented Language) in the banking sector raises an existential question:
Why does this archaic development language, devised in 1959, remain the cornerstone of financial systems worldwide?
Despite the evolution of more sophisticated technologies, COBOL’s tenacity within banking is both a testament to its original design and a glaring indictment of systemic inertia.
A Brief History of COBOL
COBOL was conceived during the late 1950s, a period when computing was in its nascent stage. It was developed by a committee of researchers led by Grace Hopper, aiming to create a language that was not only machine-independent but also accessible to business managers. Its syntax was designed to be readable and to facilitate data processing, making it ideal for business applications.
Initially, COBOL gained rapid adoption due to its ability to handle large volumes of transactions, a critical requirement for industries such as banking, insurance, and government. The language’s design prioritized readability and straightforward logic, which enabled businesses to automate complex processes that were previously manual and labor-intensive.
The Current Usage of COBOL
Despite its age, COBOL remains deeply entrenched in the banking sector. Approximately 220 billion lines of COBOL code are still in use today, with many financial institutions relying on these legacy systems for core banking operations. These systems manage everything from transaction processing and customer records to ATMs and credit card systems.
The primary reason for COBOL’s persistent use is its reliability and stability. Banking systems require exceptional precision and uptime, areas where COBOL has historically excelled. Moreover, the sheer scale of existing COBOL codebases means that replacing or significantly altering these systems would be a colossal and risky undertaking.
COBOL exists purely because of banks. When I was learning the Pascal programming language back in the 1980’s, COBOL was already dying.
Nikos Dimou (Cybersecurity expert)
The Critics’ Perspective
The continued reliance on COBOL is not without its critics. Many argue that clinging to this outdated technology is a significant hindrance to progress. Some of the key criticisms include:
- Obsolescence: COBOL’s design is antiquated, making it ill-suited for modern development practices. It lacks the modularity and flexibility of contemporary languages, making it difficult to integrate with newer technologies.
- Skill Shortage: The number of programmers proficient in COBOL is dwindling. As veteran COBOL programmers retire, there is a growing skills gap, which makes maintaining and upgrading these systems increasingly challenging and expensive.
- Maintenance Costs: Keeping COBOL systems operational is costly. Banks spend billions annually on maintaining and patching these legacy systems. This money could arguably be better spent on developing more efficient, modern systems.
- Security Concerns: Old systems are more vulnerable to cyber threats. Modern programming languages often come with enhanced security features and support, which are critical in today’s cybersecurity landscape.
Is There No Better Technology?
The question arises: Why not replace COBOL with more modern languages? Technologies such as Java, Python, and even newer languages like Go and Rust offer significant advantages in terms of flexibility, integration capabilities, and security.
The primary barrier to migration is the scale and complexity of the existing systems. Financial institutions have billions of lines of code entrenched in COBOL. Rewriting or replacing these systems would not only be prohibitively expensive but also incredibly risky. A failed migration could disrupt services, leading to potential financial losses and customer dissatisfaction.
Additionally, there is a cultural aspect to consider. The banking industry is traditionally risk-averse. The old adage “If it isn’t broken, don’t fix it” resonates strongly here. Despite its drawbacks, COBOL systems are stable and reliable, qualities that are paramount in financial services.
Alternative Views
Questions posed in social media regarding the persistence of teaching languages like Fortran, COBOL, and QBasic in computer science programs highlights a significant disconnection between academic curricula and industry practices. In a rapidly evolving technological landscape, the insistence on teaching these outdated languages appears misguided.
Modern programming languages and frameworks such as Python, JavaScript, and machine learning tools are where the industry is heading, and proficiency in these areas is critical for graduates entering the job market. By continuing to emphasize archaic languages, universities risk producing graduates who are ill-prepared for contemporary technological challenges and innovations.
Furthermore, the resources devoted to teaching these obsolete languages could arguably be better spent on subjects that equip students with relevant and forward-looking skills. Cybersecurity, cloud computing, artificial intelligence, and data science are just a few areas where expertise is in high demand. Allocating curriculum time to legacy languages instead of these crucial topics may impede students’ competitiveness and adaptability in the workforce.
While understanding the historical context of computing has its merits, the primary goal of a computer science education should be to prepare students for future technological advancements and industry demands. Therefore, it is imperative for academic institutions to critically reassess their curricula to ensure they are aligned with the needs of the modern tech ecosystem.
A Necessary Evolution
While COBOL’s role in the banking sector is deeply rooted, it is clear that its future is unsustainable in the long term. The industry faces a critical juncture where it must weigh the risks of maintaining legacy systems against the potential benefits of modernization.
For COBOL to remain a viable part of the banking infrastructure, significant investments in education and training for a new generation of COBOL programmers are necessary. Concurrently, banks should develop comprehensive strategies for gradual migration to more modern technologies, balancing the need for innovation with the imperative of stability.
In the final analysis, COBOL’s enduring presence in banking highlights a broader issue: the struggle between the comfort of the familiar and the necessity of progress. As the financial world continues to evolve, so too must the technologies that underpin it, ensuring they are fit for purpose in an increasingly digital and interconnected world.
Author Profile
- Lucy Walker covers finance, health and beauty since 2014. She has been writing for various online publications.
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