Legacy Systems & Modernization

COBOL in the 21st Century

Amrit Sanal
Data Scientist, Ameriprise
October 11, 2025

When most people think about programming, they picture sleek modern languages like Python, JavaScript, or Java. What they don’t picture is COBOL, a language first designed in the late 1950s. Yet, this “ancient” language continues to quietly power the systems we all depend on daily.

From swiping your credit card to withdrawing cash at an ATM to processing your payroll, there’s a good chance COBOL is working behind the scenes. It is unequivocally one of the most important invisible engines of the global economy.

The Scale of COBOL’s Footprint

The persistence of COBOL is a reflection of how deeply it’s embedded in critical infrastructure.

800 Billion
Lines of Code
Estimated lines still in active use worldwide.
70–80%
Global Transactions
Of all business transactions run on COBOL systems.
95%
ATM Swipes
Of ATM transactions pass through COBOL programs.
92 of 100
Top Banks
Continue to rely on IBM mainframes running COBOL.
80%
Federal IT Budget
Goes toward maintaining legacy systems in the U.S.
"Replacing it entirely would be like trying to rebuild the foundation of a skyscraper while people still live inside."

Why COBOL Refuses to Die

So why hasn’t COBOL been replaced after six decades? Three reasons stand out:

Proven Reliability

COBOL systems are designed for high-volume, mission-critical transactions. Banks, insurance companies, and governments trust them because they’ve been battle-tested for decades. Few modern systems can match their uptime and accuracy.

Deep Integration

COBOL systems are at the core of how money, benefits, and data flow globally. Replacing them isn’t as simple as swapping one program for another.

High Risk of Failure

Even small errors in core financial or government systems can have devastating effects. That’s why many CIOs take the stance: “If it isn’t broken, don’t fix it.”

The Growing Challenges

Despite its strengths, COBOL’s dominance creates challenges that organizations can't ignore forever:

  • Talent shortageThe average COBOL programmer is ~55 years old. Few new developers are learning the language.
  • High maintenance costsSome organizations spend up to 75% of their IT budgets just keeping these systems alive.
  • Security risksLegacy systems weren’t built for today’s cybersecurity threats, making them harder to protect.

The Road Ahead

COBOL’s story isn’t just about the past—it’s about the future. While full replacement may be unrealistic, AI-assisted modernization offers a bridge between old and new. Emerging tools can:

  • Analyze and document undocumented COBOL code.
  • Translate business logic into modern languages like Java or Python.
  • Generate automated tests to ensure critical functionality isn’t lost.

In other words, AI may finally make modernization feasible without the massive risks that have stalled it for decades.

Conclusion

COBOL is the hidden backbone of modern society. For now, it continues to run the world quietly, reliably, and at scale. But as the workforce ages and costs mount, the question is no longer whether modernization will happen, but how.

Coming Up Next:

In the next part of this series, we’ll explore the hidden costs of sticking with COBOL and why organizations can’t afford to simply maintain the status quo.