Why are Top Banks and Financial Services using Cloud Computing Services?

5 min readSep 16, 2022

banks and financial services using cloud computing services

Cloud-based technology platforms provide banks with a number of significant benefits, from data storage to sophisticated security choices.

Using hardware (for storage) and software (for the service) to store and retrieve data is the simplest definition of “cloud banking.” By offering capacity and security, this technology has proven to be an excellent ally in information management, particularly for banks. Additionally, it enables the quicker and less expensive rollout of financial services while also enhancing their adaptability to market demands.

Ten years ago, the first cloud computing service providers entered the market. As a result of the industry’s maturity and rapid growth in a number of business areas today, it offers an automated product that is customer-focused.

According to research by The Association for Financial Markets in Europe, 63% of investment banks in Europe already use cloud computing, up 33% from 2018. (AFME). It has become vital to spend money on easier and faster solutions since we are operating in a highly competitive environment.

What is Cloud Banking?

Bankers are aware of the potential of cloud computing app development and see it as a key factor in the digital transformation of the banking sector. Data storage and access over the cloud are referred to as cloud banking. In particular, the cloud has shown to be a superior solution for processing data by giving institutions flexibility, scalability, and security. The ability to deploy financial services more quickly, lower costs associated with launching new applications, and more adaptability to market demands are some of the main reasons why banks are choosing to use the cloud over their conventional IT infrastructure.

Reasons for Bankers’ Move to the Cloud

In order to offer financial services, banks are always seeking quicker and more flexible alternatives. How can cloud banking help bankers accomplish this specifically? Let’s first take a moment to pause and consider the main difficulties that banks now face:

1- Customer acquisition and retention

Acquiring new clients and retaining existing ones, making sure that clients use all of the services that the bank offers, and giving them excellent service to prevent them from transferring to a rival.

2- Deploying services fast to market

A solution that enables you to deploy to market fast and easily is necessary to keep up with the constant release of new services and offers and to ensure that all of your collateral is updated on time.

3-Agile innovation

Banks are required to continually adapt and reinvent themselves in order to fulfill the needs of their customers and to make their services relevant to the state of the market. An adaptable model that can be quickly recreated is necessary for this.

4- Regulatory compliance

Ensuring that everyone is adhering to the most recent policies and staying up to speed with all regulatory requirements.

5- Cybercrime prevention

Financial organizations are always seeking methods to improve security and reduce the danger of cyber hacks.

Benefits Of Making The Switch To Cloud

Here are some ways that moving to the cloud might hasten the how to make a banking sector’s app digital transformation:

1- Improved Speed and Agility

A bank would have to spend more money and take much longer than it does now to launch a new landing page on a legacy system. Banks are now far more rapid and flexible than they were because of cloud technology! This makes it simple and quick for banks to roll out new services to clients.

Overall, this methodology helps banks minimize the time it takes to launch new products and makes product testing easier. Cloud banks have the ability to innovate, swiftly release beta versions of their products, replace them with newer ones, and address errors by rapidly scaling back or reversing steps. Banks can essentially try out their goods in real-time thanks to the cloud.

2- Lower Operational and Ownership Costs

With the use of cloud computing, the banking industry may stop spending money on creating new infrastructure for each service they need to offer. Instead, companies may use pre-existing applications and APIs to provide financial services more quickly and with lower overhead and operating expenses. This enables banks the option to select services that they consider to be necessary and unsubscribe from ones that are no longer valuable, allowing them to grow both horizontally and vertically with ease. The time allows banks to concentrate on their core capabilities.

3- Enhance Customer Experience

Banks can now employ services and software from third parties to improve client experience. With the advent of the digital age, banking as a service will significantly tailor itself, from offering solutions directly to WhatsApp to giving consumers fast solutions on their phones. With the use of the cloud, banks may create an improved marketplace for their clients where they can make use of new technology services and data to provide a more complete experience for streamlining and improving each financial transaction.

Why Opt for the Cloud?

We may get a sense of the benefits that technology innovation executives are trying to gain for their companies by looking at trends in cloud adoption in the banking sector.

Banking executives are becoming more aware that the cloud is not just a technology. In a time when customers are more mindful than ever of privacy, it is a place where financial service firms may store data and apps and have improved network security.

For their part, cloud service providers are also providing a fantastic chance to improve processes, such as stopping the operation of data silos because of dangers, expenses, and legal requirements.

Conclusion

With cloud operators offering a variety of cloud services, the banking sector will only speed the switch in their infrastructure, and the future of banking will be paved with a highly customized and automated path. Cloud presents an opportunity that no other system does.