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Cloud banking: is going digital creating a perfect storm? Part 2

In this, the second of my two part blog, I explore the huge benefit of deploying your digital banking platforms in the cloud. 

I will look at how digital can support banks in their quest to remain competitive, in terms of regulation, efficiency and scale as well as how new approaches to cloud are enabling bank success in our developing, digital world.

written by Ross Mallace, Head of Cloud - APAC

In a world of  fierce competition, banks must find ways to stand out.  They must be leaders. A recent report by International Data Corporation (IDC), found that 80% of banks in Asia-Pacific (APAC) are still delivering “inconsistent, unpredictable” customer experiences.  This is likely to be because they are  still in the early stages of developing an omni-channel strategy. As a result, these institutions are perhaps lagging behind their counterparts elsewhere in the world when it comes to strengthening their offerings. However, once they have this strategy, can banks ensure real digital success?

Digital innovation needs cloud

Customer demands for instant, digital, new services are ushering in a raft of innovations. For example, the majority of the top 250 banks in Asia Pacific are expected to deploy open APIs in the next two years. To leverage the need for the right services for their customers, banks need the right infrastructure.

An infrastructure is required that enables end-to-end innovation quickly from solution conception to live production: ideally, a comprehensive cloud service which includes development and testing platforms to the final, live environment (Software-as-a-Service).

Additionally, there's demand for a solution which provides access to the resources that enable banks to deliver everything from simple cloud-based apps to sophisticated, cloud-enabled enterprise applications. This approach gives banks the agility and control they need to truly benefit from digital.

Through a portal interface, banks can now create – quickly and simply -on-demand, cloud environments using software-defined templates. Once provisioned, clients can interact with these environments through portal tools, design studio integrations and standard web APIs.

Projects can be accelerated by eliminating waiting times for environments, and support for DevOps strategies during development, testing and integration phases, & ongoing change cycles. It’s also important to remember that the benefits of a development platform in the cloud stretch beyond just supporting innovation; they making operations easier and more cost-efficient for banks.  

Banking needs cloud

A bank’s business is banking, not IT. Moving to applications that are digital end-to-end, and putting them into the cloud lets a bank focus on its core business. A number of banks already recognize this, including Deutsche, Westpac, JP Morgan, and ABN Amro.  All have been widely reported to be looking to place their core systems in the cloud, having used the cloud for non-critical systems, such as email and customer-relationship management.

Flexibility and cost are driving this transformational shift but also, perhaps because confidence in the cloud has also increased as a result of clearer guidance from regulators, it is now seen as low risk. 

Where once security, access, and resilience were major concerns, today banks look to the cloud to help deliver these very attributes as part of an integrated digital strategy. The levels of encryption and data segregation are better understood, helping alleviate C-suite concerns about using public clouds.

Security and anti-fraud are also seen as safer in the cloud, because cybercrime has evolved to pose a potentially existential threat to banks. This advanced approach to services takes the benefits of cloud to the next level, enabling true banking innovation. With digital being so critical to APAC customers, can banks afford not to move to a cloud environment?

To learn more about the benefits, and how banks and fintech companies can gain from moving operations to the cloud, meet us at Sibos 2018 or contact us.

 

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