Cloud Computing and the Banking/Financial Industry

Cloud Computing is the use of a network comprising of remote servers, which are hosted on the Internet as a platform for the storage, management, and processing of data, instead of using a personal drive, local server or a computer. As a financial provider, numerous advantages come with the access to and application of cloud computing services. To avoid misunderstandings, many people use cloud computing and DevOps consulting like squadex.com/devops-consulting/

Benefits of Cloud Computing Services

Convenience

The ability to access information remotely and instantly creates convenience that printing services and other analog systems of information storage and access cannot provide. Banking institutions and other financial service providers are able to receive and share data and information from/to their clients in real-time.

Cost Efficiency

The use of applications and financial solution software creates convenience, which in-turn translates into a reduction in operational costs. Paperwork and other media of information storage and sharing proved tedious, costly and formed the bulk of operational costs for most financial institutions. Cloud computing significantly reduces operational costs, creating savings that can be invested in other ongoing projects.

Security

The adoption and application of cloud services have translated into secure and convenient storage and transfer of information in the financial industry. Although hacking is possible, cloud service is the safest way of information storage for financial providers. As a service provider, it creates confidence both to you and to your client.

Business Continuity and Agility

The service provider manages the technology and technicalities of the service. This leaves the business with less workload thereby shifting focus to other departments to increase efficiency and productivity, which translates into higher profit margins.

Promotion of Green IT

Cloud services promote the use of environmentally friendly practices in the financial sector. Previous modes like paperwork led to significant damage to the environment through deforestation to make paper. Cloud services, however, help in reducing environmental damage through the promotion and use of green IT.

Cloud Service Models

There is an array of cloud services to choose from. It is prudent to choose and take-up a model that best fits your business requirements as a financial provider. The models include:

Software-as-a-Service (SaaS)

This model is licensed upon subscription and is centrally hosted. The subscribers access information and data from the business software, browsers housed by the service provider. It is one of the most convenient models for financial service providers due to the services they can access. Services like accounting, invoicing, enterprise resource planning (ERP), service desk management, customer relationship management (CRM), and other forms of content management can be accessed on this model.

Business Process-as-a-Service (BPaaS)

The model guarantees delivery of business process outsourcing services sourced from the cloud and constructed for application by different users. Although it is not as detailed as the SaaS, the model is used for general processes like human resource management, payroll management, invoicing and billing.

Infrastructure-as-a-Service (IaaS)

The IaasS model provides virtualized computing resources to subscribers through the internet. Instead of adopting and using servers, software, data center space, and network equipment, financial businesses purchase resources as fully outsourced services from service providers. It offers services like data partitioning, security, billing, invoicing among others.

Platform-as-a-Service (PaaS)

The model platform allows subscribers in the development, running, and management of applications without the complexity associated with the building and maintenance of the infrastructure. PaaS hence enables the subscriber to choose the type of services the model can provide.

Banking on the Cloud

Cloud computing services are commonly deployed in three types including private, public and hybrid. A private cloud is specifically developed and operated by a particular company, making it the most secure option for financial providers. Private cloud service models can both be operated and managed by the company, or a service provider. Public clouds are developed for application by large industrial groups or the general public. The model’s ownership lies with the service seller/provider. Hybrid infrastructure, on the other hand, comprises two or more clouds, either public or private, linked together while remaining as unique entities.

The banking industry requires addressing and adapting to the dynamic data input demands. The uptake of cloud computing services amongst financial service providers has been relatively slower than other sectors. This is mainly due to the crucial and confidential nature of the data shared between banks and clients. Efficiency, security and reliability issues have also played a major role in mitigating the uptake. Over time, the increase in security, efficiency, and reliability has resulted in the uptake of cloud services by banks and other financial service providers.

Private cloud services come with an array of services that make information and data storage, access and sharing both secure and convenient. Public services also guarantee security and efficiency as well as economies of scale and cost efficiency. An incremental approach can be adopted by banks, where non-core operations are processed using cloud services as the bank gradually adopts other services on the platform.

The benefits of transforming into a cloud service subscriber outweigh the risks involved in the same. Transparency, efficiency, convenience, and security are some of the main benefits that banks can gain by upgrading their systems and adopting cloud-computing services. Moreover, these systems create convenience for the banks’ clients. Thereby improving the relationship between the bank and the client. Increased efficiency and reduced operational costs ultimately translate into increased profits for financial providers.

Conclusion

In the wake of the digital era, the storage, access, and sharing of information have been revolutionized and eased for financial industry players and stakeholders. The various services offered within and without the bank have been improved by the adoption and application of cloud services. This has translated into improved service provision and business agility for financial providers already using the services. Moreover, cloud services improve customer satisfaction by allowing an enterprise to offer efficient and prompt services.

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