In recent years, banks have become one of the largest adopters of cloud. According to
IBM, they account for around 16% of total global cloud expenditures, and also face some of the most stringent security, regulatory and compliance obligations of any sector.
A recent Celent survey commissioned by IBM found that 33% of financial institutions indicated that it would only take between one and three years to reach 75% of workloads running in the cloud. Another
20% said it would take three to five years. This means that more than half of financial institutions expect to run their workloads in a cloud within five years.
Banks face a multitude of challenges to keep up with the growing demands from customers for seamless user experience across digital channels like online banking, without compromising on quality and security. While the cloud has been avoided by some banks
in the past due to security concerns, security and regulatory compliance are key focal points of cloud technologies in today’s business environment.
For CIOs in financial institutions like banks, there is an opportunity to enable continual transformation with cloud networking technologies that can support innovation on a global scale and address their compliance requirements.
A Complex Regulatory Landscape
Banks are facing a multitude of regulatory and operational challenges in today’s market.
Banks across the globe are facing a complex regulatory landscape due to a growing number of security policies and compliance challenges. Many regulators consider the use of cloud services as a form of outsourcing, usually involving multiple parties including
the network provider and the cloud service provider (CSP). More financial regulators are establishing standards and guidance around the use of cloud computing, including:
Banks need to assess the risk profile of different vendors and the controls required for data protection and location. As for the operational challenges, they need to be able to scale their cloud infrastructure and services to support the growth of their
digital services and also meet the usage requirements. Other aspects include having the visibility to continuously monitor system resources such as the network throughput, latency and packet loss.
Due to the high-value data that banks store, process and transmit, they are a top target for cyber criminals. According to
VMWare, attacks targeting the financial sector grew by 238% between February and April 2020. 80% of surveyed financial institutions reported an increase in cyberattacks over the past 12 months, and 82% said cybercriminals have become more sophisticated
over the past 12 months. This threat requires a strict regulatory landscape that must be abided by to protect consumers’ data.
In order to keep up in a fast paced market and enable continual transformation, utilising new cloud models is vital. Banks can utilise cloud models to create an infrastructure that provides high availability, data integrity, portability, confidentiality
and risk mitigation. The challenge is to find a complete solution that can provide the full regulatory compliance required by banks and other financial institutions, without adding complexities to operations.
Complying with the Cloud
Hybrid or multi-cloud environments can provide banks with the flexibility and availability to seamlessly move workloads to the public cloud, while benefitting from added data security and privacy by keeping mission-critical data on-premises.
Banks can choose different CSPs like Amazon Web Services, Google Cloud, Microsoft Azure and Oracle depending on their workloads, and in turn reap the benefits of each provider. This allows banks and other financial institutions to create competitive offerings
for customers, while retaining security and compliance.
Looking especially at the network underlay delivering the cloud hosted applications, a service provider like Epsilon can give seamless direct access and advanced levels of orchestration of the data to and between all these providers through a secure and
private network environment. The right solution will abide to all regulations and security requirements, so the bank can comply without needing to worry about complexities. Other benefits from a comprehensive cloud networking solution include:
- High availability networking with default encrypted connections.
- Cloud segmentation and cloud security policies in a single platform, with optimal performance for cloud applications.
- Embedded security solutions such as FQDN filtering and service insertion of next-gen firewalls, to meet security and compliance requirements.
Flexibility for the Future
An advanced cloud networking solution can provide the operational visibility, control and troubleshooting needed to keep up with rapidly changing regulations and customer demands across the globe. With the right team of experts, banks can better manage networking
and security in the cloud for with simpler onboarding and configuration.
To keep up in a rapidly changing market, banks will continue to leverage the benefits of using multiple CSPs, but they will need to connect multiple clouds, distribute resources, minimise data loss risk and mitigate downtime – a lot to manage. Multiple clouds
enable banks to achieve the full flexibility and benefits of the cloud – they just need to unleash their full potential with an end-to-end solution that is ready for the future.