Future cloud predictions for banking and fintech sector
The use of cloud-based services has been gaining traction amongst a wide range of industries and businesses. According to Gartner, over the last couple of years, cloud companies have noted more than 17% growth. Additionally, as of 2019, 94% of enterprises are already using cloud services and this number is still expected to grow.
As stated by Anton Zujev, head of business development at Fininbox, a Banking Software as a Service (SaaS) provider for financial institutions, cloud-based solutions should be seen as the ‘only way forward’ due to their flexibility and convenience. Mr. Zujev also distinguished three trends for the near future for the banking and fintech sectors in particular.
Extra time for the tasks requiring personal input
Moving operations to a cloud infrastructure may provide a technological edge compared to traditional IT systems. Cloud technology enables to automate routine operations, such as backing up, scaling and monitoring data, thus streamlining the workflow. Around 90 % of IT and data management operations are predicted to become almost completely automated in the next 5 years. This will position cloud-native technology as a go-to solution for faster and cost-efficient information processing.
“Development and performance wise, cloud services are considered to be more accessible compared to traditional on-site servers, so the transition towards nearly-full automation is more likely to happen there than on more traditional platforms,” claims Mr Zujev.
With around 35 % of businesses looking to make the shift to cloud technology, tasks previously requiring human supervision will become automated: this could help gain a competitive advantage, as more time could be allocated to work requiring more personal input. “Basically, there will be extra time for the tasks requiring a more personal touch. More personalised interactions will allow us to invest more in business development, marketing and attracting new talents. Also, such an approach makes any business sustainable and thus – more successful,” says the representative of Fininbox.
Sensitive data may be transferred to the cloud
Future fintech companies will embrace using cloud technology for sensitive data storage, as it mitigates risks by increased accountability. Instead of maintaining their servers independently, businesses will be prone to outsource such service, as third parties may be held liable for any security breach, whereas internal teams may avoid serious repercussions. “Cloud servers belong to third parties, which are legally bound by contracts regarding their customers. In case of a data breach, they become financially liable for any abuse or leaks of client’s intellectual property, whereas internal teams may not bear such accountability. Therefore, strict legal obligations ensure that third parties are committed to maintaining data integrity and delivering excellent service,” explains Mr Zujev.
Additionally, cloud technology provides the possibility to encrypt all data of the latter. Due to the built-in security, fintech companies and banks can rely on the system to protect even the most sensitive data, enabling a wider range of businesses to shift to cloud servers. “For example, government data could be centralised – it would make the performance of various institutions simpler and easier. When it comes to banking and fintech, the confidence of both customers and regulators on cloud services is growing because of recently developed compliance procedures and data protection.”
More diligent cloud provider selection
Throughout 2020, the demand for cloud-native technology will continue to increase as the market is expected to grow to $299.4bn. Choosing the right part partners to entrust your business to could be the difference between reaping the benefits of cloud-based systems or falling behind the competition. In the opinion of Mr. Zujev, providers offering full-service packages will come out on top due to the high demand of catch-all and secure cloud computing.
“Since cloud is gaining more importance, IT and fintech businesses are starting to value providers who can support them with both front-end and back-end services”, adds Mr. Zujev.
Reliability along with smooth performance will become a crucial requirement when choosing a trusted partner to conduct business with. “Only reputable, stable and transparent cloud companies will win in the long term due to all risks related to sensitive data in both IT and fintech industries,” says Mr. Zujev.