bankingciooutlook

Reasons Behind the Increased Adoption of Cloud Technology in Banking

Banking CIO Outlook | Friday, July 08, 2022

Leading global financial organizations have expedited their cloud adoption, which may offer guidance for effective digital transformation throughout the industry.

Fremont, CA: The banking industry has never steered away from innovation; it is new products to encourage customers to save more or novel approaches to communicating with customers and clients. However, the adoption of cutting-edge technology, such as cloud computing, has been somewhat gradual until lately. Leading global financial organizations have expedited their cloud adoption, which may offer guidance for effective digital transformation throughout the industry.

The interaction between cloud technology and banking professionals gets explored in a recent study that assessed the sentiment and operations of 21 medium-sized and big banks. The findings shed light on how the financial sector sees cloud technology and how its use might enhance banking operations and efficiency.

Scale-up abilities

Traditional banks can swiftly modernize and keep up with the innovations that "born-in-the-cloud" challenger banks are bringing to the market thanks to the cloud, which offers a stable, scalable, and adaptable data infrastructure. Using a hybrid and multi-cloud strategy is one method that is becoming more and more popular for achieving this.

Most organizations are considering diversifying their use of cloud technology, and 76 percent of bankers now say that doing so is essential if they want to take advantage of the resilience and security upgrades made by the major cloud providers. These cloud "hyperscalers" also offer frequent upgrades and continue to roll out innovative new services and platforms.

Organizational inertia

The capacity of technological advancements to simplify processes and make them faster and more secure gets typically lauded. According to the study, 62 percent of bankers consider organizational culture and inertia a major industry concern. Cloud technology can improve organizational efficiency since banks can spend less time maintaining the interface between trade volumes and payment infrastructure, making it adaptable for scalability and cost. Bankers are aware of this possibility since 95percent of businesses know that cloud computing may speed up time to market.

Optimizing costs

According to the study, cost optimization is the main reason banks consider using the cloud for their future storage needs. Eighty-one percent of bankers said they have already implemented cloud technology to save expenses.

For financial institutions, setting up and maintaining on-premise IT systems takes time and money. However, using the cloud eliminates the need to buy and install hardware because the cloud service provider already hosts all necessary infrastructures. It also includes the hardware administration, which significantly lowers the IT support cost.

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