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Finance industry dipping a toe into cloud computing

Friday, April 11th, 2014

One of the most exciting digital developments in the financial services sector is the use of cloud computing. Exciting, because it’s one of the hottest trends around in financial technology at present. The financial sector, not known for its fast adaptation of digital trends, due to natural concerns where everything is about client data and money, is taking its first steps into this brave new world.

The potential benefits are obvious. Besides offering secure deployment options, cloud computing substantially speeds up time-to-market for new products. The keyword is efficiency: relying on excelling, up-to-date and trustworthy IT structures, enterprises reduce costs as well as risk. They don’t need to make big decisions too soon - hoping for a happy ending – but can rather go for testing the alternatives and, thus, aiming for the proven best solution.

Additionally, as the demand for business intelligence analysis tools is increasing to better serve customers’ individual needs, so does the demand for IT that can cope with such huge amounts of data. Moreover, cloud systems offer the flexibility that in today’s fast moving digital markets give a real competitive advantage – without imposing the costs for restructuring the complex in-house IT systems.

For example, a bank could decide to combine a private cloud with extensive security provision for a CRM database while using a public cloud at lower costs for less sensitive tools like marketing and social media. Apps can be developed cost-effectively through platforms as a service. And all this without any capacity going to waste, since with a cloud, you pay for what you’ve used and no more.

However, concerns regarding security and client data issues still prevail and these are hampering financial firms from jumping into the enticing warm water, as ballyhooed by the numerous providers. Indeed, well-designed cloud systems often provide more sophisticated security systems than finance companies themselves do nowadays. However the mindset will change; this is one emerging field that it will be well worth keeping an eye on in the coming months.