05 December 2016

UK FS industry warms to cloud but security concerns remain

02 September 2014  |  6760 views  |  0 Cloud on keyboard

Nearly two thirds of UK financial services firms consider cloud computing very or somewhat critical to their enterprise IT strategy but security and regulatory concerns about the technology persist, according to research from Finextra.

Finextra surveyed 106 financial services industry executives - evenly split between line-of-management and IT and operations - in the UK and Ireland for the IBM-sponsored report.

More than a quarter of respondents say that cloud technologies are very critical to their overall enterprise IT strategy and 38% somewhat critical. IT professionals are even more likely to view cloud as vital, with 74% giving a positive response.

Cloud is being used across a range of business areas, with 30% of respondents saying that it supports the back office and the same percentage citing sales. Nearly a quarter tap cloud technologies for reporting and 16% for risk. The main benefits of using cloud are faster time to market, cited by 52% of respondents, and lower costs and increased business agility, both cited by 40%.

Although the cloud is becoming increasingly popular, most applications are still hosted and delivered on banks' own infrastructure, either deployed locally or enterprise wide via a private cloud. This is partly because security and storage requirements still complicate cloud adoption, with regulation considered very important by 65% when it comes to the selection of off-premises cloud services.

There is some confusion about the rules: asked whether they believe that personal data related to UK clients needs to be retailed in the country, 40% of respondents say no and 45% say yes.

IBM says that this chimes with its own experiences working with banks: "Putting aside the evolving landscape of data privacy requirements for personal information, regulators have provided little concrete guidance to the industry on what is and isn't acceptable, with much of the current regulation only focussed on traditional outsourcing models."

You can download the full report here. Finextra and IBM are also hosting a breakfast roundtable on the topic, featuring Richard Roberts from Deutsche Bank, David Zimmerman from IBM Global Banking & Financial Markets and Ian Sayers from Zapp. You can register your interest in attending here.

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