Cloud technology is the salvation of the financial services industry. The cloud’ elasticity brings a new level of efficiency by matching volume to capacity. The cloud gives enterprise protection against cyber crime and is compliant with data regulations.

Financial services are a stovepipe industry . Built on bespoke legacy systems installed before the Internet.  Systems with a narrow business focus, costumed with minimum security and sized for peak volumes.  These systems are completely at odds with todays’ open and mobile banking environment and the need for a zero trust model (Blockchain).

One example is the business move by a Bank, involving cloud. One of the Trade Unions suggested, “The bank agreed the migration of the accounting details of 20 million customers could 'weaken existing security controls and adversely effect the confidentiality and integrity of Bank data'.” The opposite will happen. 

Cloud suppliers know brand reputation is key. The biggest threats to their reputation are the cyber criminals. To stay in the cloud business, there is a need to constantly remove this ever present and changing danger by strengthening security on going controls. Cyber security is an imperative to stay safe.

Banks on the other hand have to bring these same activities to their own technical infrastructures to stay safe from the cyber criminals. Also by law (May 2018) banks need to show the regulators and clients where client data is housed,  by whom this is accessed by who has access and a separation between public and private information (GDPR).

Both cyber defence and data warehousing have to occur across a banking business often hosted by many stand-alone systems. Each of these systems has to be dealt with individually. These systems are separated and need to be linked to the enterprise. This has led to multiple data base copies and interfaces to many applicationshings are common; resulting in a technical landscape that is frustrating for both eemployees and customers. Multiple databases present more vulnerability and opportunity for inconsistency.

The cloud suppliers are raising the  standards around security. Now many different cyber security applications are used in the cloud system architecture combating a myriad of threats. Any new threats are isolated and disarmed. Then the entire cloud community enjoys the benefit of not being impacted by that specific threat again.

Compliance to the growing regulations around data presents similar issues for the banks. Banks have persistently underperformed with information given to them. Most information is trapped in the silo systems. To extract up to date data is not easy in banks given the batch processing activities. Given our need for instant responses, courtesy of the mobile phone, this is proving to be problematic.  Most banks ‘shadow post’ transactions to create the illusion of real time. It is only the next day the client really knows the actual position.

Cloud technology provides the opportunity to move straight to real time. The use of this new technology and meets our expectations for live data. A generation of legacy banking solutions and batch processing has been skipped. Just like the hand written letter is being replaced by text or email or voice. The issue now is who has the information and what is being done to safe guard the owners from financial loss or reputational blemish.

Luddites goal in 1811 was to preserve existing practises by enforcing old legislation and destroying the modern equipment coming into the market. As there is now an estimated 2.6 billion smartphones in the market, we need to try something different.

It is time to move with the technology and embrace the future. Take the elasticity, the unimpeded flow of data and the cyber security that the cloud provides and use as your elixir for digital success.