In recent times, the financial services industry has witnessed cataclysmic technological innovation. Cloud computing in financial services has created a bouquet of new service models offering better services to consumers. Cloud computing in finance is boosting productivity, cost-efficiency, and the kind of flexibility that’s making internal business processes sizzle.
With flexibility being the defining feature of conducting business, financial cloud computing is opening new markets where maturing financial services are adapting to newer ways of staying ahead of aggressive FinTech market newbies.
Cloud based financial services, because of their distributed nature and resiliency, have contributed significantly to safeguarding the integrity of financial data (cybersecurity). The availability and scalability of financial services has boomed in ways that financial institutions could never have achieved on their own.
The flexibility that allows the scaling up of capacity which matches the activity levels of business operations is the hallmark of cloud computing in finance industry
The European banks chartered a framework of financial rules to exercise proper governance and control over the risks associated with cross border financial transactions. Cloud computing for finance offers the stability and safety that works symbiotically within regulatory frameworks. The trust of the National financial policy makers gained by cloud providers is encouraging the exploration and adoption of public/hybrid cloud solutions by European banks in a sustainable manner.
Cloud computing for financial institutions can be organized in three distinguishable categories - the Public cloud, the Private cloud, and the Hybrid cloud.
In a Public cloud, finance cloud services operate outside the financial institution’s periphery. Through publicly hosted cloud services, specific control functions are provided to users via authentication mechanisms, and any institution, designated employee or consumer can subscribe to the financial services over the internet.
In a Private cloud, the cloud computing in banking and financial services is deployed within the institution which exercises comprehensive control over business operations. You will find the computing resources residing physically in on-site data centers or externally sourced to a third-party providing a hosted private cloud.
In the Hybrid cloud, the financial services cloud computing integrates both private and public clouds to deliver a bouquet of services within the same institution. Such solutions are key enablers for welcoming emerging technologies, and for accelerating the movement of big data.
The key takeaway in the Hybrid cloud is the integration of cloud computing and financial services into one powerful ecosystem.
Essentially, the Hybrid cloud for financial services is a macro-solution connecting the financial institutions operating private clouds with third party public cloud services that offer Platform as a Service (Paas), Infrastructure as a Service (IaaS) and SaaS (Software as a Service) solutions.
Cloud computing for financial services is not just an external data storage mechanism but a constantly evolving service model offering multiple service designs tailored to consumer demand
Infrastructure as a Service (IaaS)
IaaS is a cloud computing for finance design template that provides the infrastructure without institutions taking the capital cost hit, and operates on a pay-as-you-use basis.
In the bare metal model, the institution or the host provider manages the physical servers, fine-tunes the storage requirements, runs the OS, and is responsible for runtime, data accretion and applications management.
In the Virtual Server Infrastructure (VSI), it is the financial institution that largely runs the show.
Platform as a Service (PaaS)
PaaS is a big player in cloud computing for financial services. It is an on-demand cloud ecosystem enabling consumers to develop and test software applications over the internet. The financial institution delivers and manages the applications while guaranteeing data security.
Container as a Service (CaaS)
CaaS refers to cloud computing in finance industry which containerizes applications and processes enabling users to effortlessly run multiple workloads without any component overwhelming the system. It comes with a compact security and governance protocol for seamless IT Management.
Software as a Service (SaaS)
In SaaS cloud computing for financial services, bankers are provided with a comprehensive software solution where consumers can connect over the internet and access cloud-based applications through licensing models. Users are not required to install software on their computer, and the IT stack (bare metal and virtual) is administered by the service provider.
How has the industry reacted to financial cloud computing solutions?
According to Eurostat, for the decade ended 2020, 36% of EU businesses accessed cloud computing services, with the manufacturing sector marking presence as a significant cloud user. The biggest reveal is that 55% of cloud usage targeted financial and accounting software services.
Are European Banks opening their doors to transformational technology?
Banks inundated with IT cost overruns are strategically migrating from on-premises systems to cloud financial systems. Banks have realized that finance cloud services offer the ideal platform to augment IT Infrastructure, expand markets, and innovate new products that are in perfect sync with changing consumer preferences.
Cloud technology has weaponized established financial institutions to compete with FinTech newbies entering the marketplace, and has levelled the playing field. Top financial wizards are free to focus on core business problems while third party Cloud Service Providers (CSPs) fortify the management of an IT infrastructure which is solution oriented.
How cloud impacts financial services and enables transformational technologies
Ask a financial services provider to list its priorities, and it will emphasize that the goal is to remain a highly competitive player in an aggressive financial market, retain viability of operations, and cyber security-proof the whole gamut of applications, business processes and IT infra.
Innovative cloud computing financial services have red-carpeted paradigm shifts in the industry. Let’s highlight how cloud impacts financial services in the banking sector:
Blockchain cloud computing in banking
The distributed ledger technology based Blockchain that’s expanding globally is offering a slew of services like cryptocurrencies, media streaming, and big data storage. The Blockchain finance compliant cloud solution can expand a Bank’s transactional outreach over a huge network, besides cocooning data in multiple layers of security. In one stroke, Banks and private financiers gained huge momentum in transactional speed, operations efficiency, and trustworthiness, qualities that traditional IT systems could never guarantee.
The Internet of Things (IoT) and Big Data Analytics
It is estimated that by 2025 there will be at least four IoT devices per person and aggregate IoT connections will reach 30 billion. This astonishing statistic reveals the scope and extent for delivering bespoke financial solutions to consumers. Only financial industry cloud computing solutions equip you to handle the Big Data Analytics that provides in depth insights opening up new business trajectories.
Cloud computing in financial services industry powered by Artificial Intelligence (AI)
It’s difficult for a bank’s limited IT stack to service a global audience whose financial perceptions and hunger for financial applications are changing by the day, by the hour. AI powered cloud computing in banking sector provides an insight-driven, strategically customer-centric financial problem-solving ecosystem which is rewardingly interactive.
AI cloud computing in banking industry dramatically improves the quality of credit decision making, streamlines complex trading processes, and brings financial risk management under control while addressing cyber security issues intelligently.
These are the benefits of cloud computing in financial services
The Flexibility Guarantee
You notice how cloud impacts financial services when banks become more agile. From an inflexible, growth limiting, costlier, and slower IT stack, the financier can move up several levels to larger infrastructure where scalability effortlessly matches growing and ever-changing consumer demand.
The Time To Market Gain
When you transition from bad Time To Market management tied to traditional IT infra to financial services cloud solutions, you become a powerhouse that delivers bespoke financial solutions in near instantaneous real-time.
Productivity boosting, cost-effective cloud computing for finance
From a capital-intensive IT project that’s a drag on business resources, banks and financiers can move to an economy of scale where you pay-as-you-use, and cloud computing infrastructure, storage and data management issues are cost-optimized to boost the business bottom-line.
Low impact Capital Ratio cuts losses, boosts profits
Compared to traditional IT on-premises infra which attracts high impact capital expenditure, cloud computing in finance industry with virtually unlimited storage space and scalability substantially reduces cap costs, streamlines operations, and lowers overheads.
Agile, AI powered cloud security for financial services
The flawed or outdated cyber security protocols of on-premises infra constrained by limited resources can severely compromise data integrity of financial businesses and their consumers.
Is the cloud secure enough for finance companies? The answer is in the affirmative.
Cloud computing in financial services is designed to respond dynamically to credit risk and the movement of Big data. The vastly improved CSP cloud security cover involves firewalling the business perimeter, intrusion monitoring protocols, layered firewalling of applications, and data encryption.
In a financial sector that is vibrantly changing to bespoke financial services customized to consumer preferences, businesses need lean and mean operating models. Cloud computing for finance introduces much needed flexibility and agility that capitalizes on trending technology to not only boost the balance sheet but also carves, retains, and grows your market share like never before.
Become an active user of cloud financial systems, and kickstart your journey to a stable, efficient, and cost-effective IT infrastructure by leveraging the humongous talent pool and expertise of the Best Managed IT Service providers and show the world that you have truly arrived, and you’re here to make a difference.