The financial industry is going through a huge change in 2020. Financial services firms are in a unique position to modernize and improve business operations. How do you pinpoint the best and safest roads to prosperity, business continuity, and agility? This may seem like a tough nut to crack. That is where public cloud adoption enters center stage. Making the switch to new and unfamiliar tech is an understandable concern, given the critical factors such as rising cost pressures, managing complex business data and workloads, training existing IT staff, and so on. These concerns can be mitigated when turning towards expert IT services that hinge on public cloud power.
There is a huge seismic shift working in favor of public cloud. Market stats show growing tendencies towards cloud adoption. According to a recent forecast by Gartner, in the current climate, by 2022 a cloud shift across key enterprise IT markets will surge to 28% (as opposed to 18% in 2018). Bigger financial market players are making the crucial leap to public cloud. BI reports that PayPal is looking to handle the bulk of its transactions via Google’s public cloud. Goldman Sachs revealed its intentions to migrate their Marquee app to Amazon’s cloud, in an effort to attract fintech developers. Meanwhile, JPMorgan is creating a cloud engineering hub in Seattle, which is minutes away from Amazon and Microsoft. As you can see the big players are already hopping on the bandwagon. Let us have a quick gander at some of the trends in financial services:
- Embracing Public Cloud for Business Operations
- Security and Compliance
- Hybrid Cloud
- Application Hosting
- AI and Machine Learning in Public Cloud
- Cloud Solutions Using OPEX Model
Embracing Public Cloud for Business Operations
Banks, hedge funds, and diverse financial services firms are still having trouble planning the road ahead. Banks, for instance, see the cloud space as the perfect launching point towards digital transformation and business resilience. Initially, many firms have issues regarding security, although they soon realize the well-known truth – public cloud providers have tremendous spending power to maintain their cloud environments. The public cloud environment and infrastructure feature numerous advantages and that’s why they are seen as one of the hottest trends in financial services. Feel free to check out the biggest 11 benefits of public cloud. Knowing these advantages could help you crystalize exactly what is best for improving and modernizing business operations.
Security and Compliance
Many companies have learned valuable lessons and are taking extra caution every step of the way. The priorities are to improve data management, increase computing power, and storage capacity. This is often a dynamic and ever-changing beast. The need for safety and security has risen dramatically. Adoption of public cloud advisory services and public cloud provider tech, easily mitigates any potential soft spots in security, minimizing chances of cyberattacks. For example, every application that is deployed is always monitored, thereby regularly checked by expert in-house IT teams or your trusted outsourced IT partner. As a result, data is controlled within the safety of the public cloud. Such a controlled environment allows for increased customization to ensure smooth cloud deployments. Also, given the variety of compliance and regulations standards within the financial services industry, companies are meticulously focusing on Service Level Agreement (SLA). Reviewing if the services provider can align those properly with company business needs. Encrypting Data is equally important. Encrypting sensitive data is crucial when meeting compliance standards.
In addition, numerous companies are exploring other options to increase flexibility. They are looking to adapt their IT infrastructures to combine cloud services utilizing hybrid cloud. This represents a mix of all the benefits of public cloud, in addition to private cloud (or on-prem) services that might suit certain businesses. Because of this, Microsoft and Amazon are now hitting the market with their own hybrid solutions. These may solve the problem for companies that are looking to reap the massive benefits of public cloud but are afraid of certain disadvantages of on-prem.
In the financial world, timing is everything. When financial firms need to know that their applications can run smoothly and effectively to meet everyday goals. However, when the public cloud is concerned, moving your legacy applications to the public cloud can be quite a challenge. Public cloud environments are often complex, so it is a good move to turn to a public cloud MSP with lots of experience in the financial industry.
AI and Machine Learning in Public Cloud
Machine Learning (ML) algorithms are popularly used in the tech industry and are increasingly becoming valuable for large-scale processes. Machine learning is a complex process, but it has a very simple and practical purpose – to learn, adapt, and get better. It is software or tech that is constantly self-improving. In a nutshell, ML automates intelligent decision making. Machine learning can be used for factor selection (Quantitative Finance). ML also applies other practical uses such as tracking transactions, zeroing in on suspicious accounts and activities within the cloud, and therefore improving security and more. Modern-day public cloud providers have an amazing variety of powerful AI-based tooling to improve enhance security and improve trading strategies. Banks, for example, are progressively utilizing AI and ML to process automation for trade finance, smart contracts, foreign payments, and so on.
Cloud Solutions Using OPEX Model
In the business world, OPEX is an abbreviation used to describe “operating costs” or “operational expenditure,” or more precisely expenses that come with running an everyday business. This can include anything from services to customer/client care, or any consumable resources that are paid for regularly. In short, it is the pay-as-you-go model. CAPEX, on the other hand, denotes long-standing investments and long-term commitments for equipment, resources, capacity, and so on. The trend in financial services is increasingly using managed public cloud services, and therefore switching to OPEX. The result is: driving innovation and delivering a better customer experience. Why is that? The simple answer is OPEX is a more cost-effective and more flexible operating model. Running and maintaining the cloud is left to cloud experts. In that scenario, the financial services firm’s existing staff focuses on the regular duties necessary to run the business smoothly. Financial forecasts are kept stable and predictable while hiring new staff or additional training of regular staff is no longer necessary.