Banks move toward cloud infrastructure
Many large financial institutions encounter a large amount of active data on a daily basis. From deposits and withdrawals to monetary transitions and certificate of deposit accounts, banks need to provide their customers with flexibility and security. For those merging online transactions with in-house operations, cloud computing offers an environment necessary for an omnichannel business approach.
Reducing overall expenses
Customer service aside, it has become more expensive for financial enterprises to maintain a contemporary data center. Although servers were built to last, the speed and expanse of 21st century commerce have rendered them nearly obsolete. Maintaining on-premise systems has also grown more costly as IT departments with limited capabilities are forced to adapt to changing performance needs.
According to Gartner, 60 percent of banks worldwide will be forced to transition the majority of their IT responsibilities to cloud servers by 2016, primarily due to poor return on equity. The report stated that the consumerism is expected to ignite revolutionary waves throughout different industries as well. As a result, the United States market will encounter vast shifts to advanced technologies, prompting monetary enterprises to follow suit.
Penny Crosman, a contributor to American Banker, followed up with an analysis of Gartner's prediction, citing increased usage of mobile devices and prevalent outsourcing services. Banks possessing multiple branches and several data centers will eventually be overwhelmed by labor expenses associated with such a system.
"Storing data in the cloud can be far less expensive than storing it in-house, and the cost savings could be a powerful incentive for banks to migrate to the cloud," said Crosman.
Reviewing the migration and the features
The initial start-up costs presented by most cloud hosting companies will most likely intimidate banks eager for immediate economic benefits. Because the technology is expected to encounter continuous development and restructuring over the next few years, it is likely that related services will grow cheaper. For large institutions handling millions of transactions each day, the public cloud seems to be the viable solution.
Cloud Pro acknowledged a few key traits associated with the public platform that are sure to result in a long-term return on investment. Commodity infrastructure and applications, such as email, file storage and Microsoft Office tools allow for remote, real-time collaboration between employees.
A cloud infrastructure service further allows financial organizations to easily integrate software that has no preconceived reliance on legacy systems. If a bank wants to test a new operating system or program, deploying it in the cloud won't put the company's transactions at risk.
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