How the financial sector is leveraging cloud?

The mistook notion that cloud is not able to protect the data of financial services which are by nature far more sensitive than other industries is slowly evading. Financial sector is now leveraging the power of cloud to transform their operations and have a more flexible, scalable cost-effective infrastructure for their data, applications and systems. With proper service level agreements, risk reports, assessing data and workload criticality, cloud services are now slowly being the mainstream for managing systems in the financial sector. With federated security implementation on cloud and orchestrated monitoring, the sensitive data is being secured like never before. 

The benefits of cloud for financial sector 

  • Optimized costs- Cloud is helping the financial sector curtail the expense on maintaining servers and data centers, enabling reduction of TCO. 
  • Enormous data capacity- Financial services churns out huge volume of data like data related to loans, payment transactions card transactions and so on. Ex: American Express alone has a database of 100 million credit cards globally amounting to $1 trillion volume every year. You can very well predict the enormity of the volume if other transactions are included. Cloud offers financial businesses unlimited storage and minimum need for upgradation and maintenance 
  • Compliance- Since cloud services are regulated by SLAs and strict compliance by reputed vendors, the assurance of leverage from cloud by the financial institution is maintained. 

According to Deloitte the various benefits being leveraged out in various financial segments include 

Source : Deloitte 

Let’s look at the ways financial sector is leveraging cloud 

  1. Cloud helps in maintain back-office systems without the need for continuous procurement of hardware, investing in power and cooling systems and others. Cloud negates the need for so. Through proper testing and continuous monitoring, cloud can also be used to manage the payroll, CRM and others of the financial sector 

  1. Insurance companies are readily using cloud to host their insurance management systems with PCI and HIPAA compliant clouds. Even critical customer information like claims, background, identities and others are being moved to cloud  

  1. Higher uptime- Financial institutions are reducing downtime while minimizing the cost of disaster recovery solution by moving the online systems, mobile applications which are used to serve the customers to cloud 

According to cloud security alliance: 91% of the financial institutions are using cloud at the present in some way or plan to use them in the coming 6-9 months. This figure is just double of the numbers of banks using cloud services four years ago. However much less mission critical workloads of financial institutions have been migrated to public cloud 

( Source: IBM) 

According to IBM , banks should look for three main areas while considering the option of migrating to open hybrid multi-cloud architecture. 

According to Bob’s Guide, the primary reasons banks are moving to cloud include 

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