When it comes to IT investments, there’s cost, and then there’s value.
In the early days of the public cloud, there was great fanfare about potential cost savings from the model. However, as the cloud has matured and more financial firms have migrated resources out of their corporate data centers, many IT leaders have realized that the public cloud isn’t always less expensive than on-premises resources. In fact, 451 Research found that 41 percent of IT decision-makers feel that their private clouds are cheaper than a comparable public cloud environment.
However, even in finance, money isn’t everything. Many financial firms opt for public cloud resources — even in instances where they will cost more than on-premises investments — to unlock cloud benefits such as speed and agility. Here are some of the benefits and business objectives that are causing firms to prize value above cost when making decisions about the cloud.
Cloud Efficiently Manages High-Volume Transactions
The public cloud helps financial firms to manage high-volume transactions while also running other critical services. The Financial Industry Regulatory Authority, for example, uses cloud infrastructure to help the organization process 155 billion market events every night while at the same time running all of its surveillance routines.
Cloud Providers Offer Easy Regulatory Compliance
Regulatory compliance is a necessary headache: It’s not the reason anybody goes into the financial sector, but ignoring it can cause substantial problems for financial firms. A number of financial institutions are attracted to cloud services that help to automate compliance controls, freeing up staff time for tasks that are more challenging, more interesting and more centered on the mission of the organization.
In June 2019, Amazon Web Services announced the general availability of AWS Control Tower and AWS Security Hub, after a seven-month preview period. The services provide organizations with a dashboard view of security tools and automate the process of setting up secure and compliant environments.
Cloud Tech Simplifies Auditing and Testing
Using cloud technology, notes Banking CIO Outlook, financial firms are able to embrace a culture in which “everyone’s a programmer,” generating purpose-built tools that are easier to audit and test than alternatives. It offers the example of a global asset management company that leveraged Google Cloud’s public cloud environment to create new apps for fund allocation and marketing. The approach provides the financial firm immediate access to development instruments for company customers, and also allows it to take a user-driven approach to software delivery.
Institutions Become Early Adopters of Emerging Technology
What’s more, the public cloud can be an effective method for delivering innovative applications such as machine learning, according to Banking CIO Outlook. For instance, the publication reports, some financial services firms are adopting cloud-based machine learning systems that incorporate tools to help with collecting and verifying data, analyzing and managing processes, configuring and monitoring infrastructure and other tasks. Firms are also implementing cloud-based tools with features such as model monitoring, diagnostics and reporting.
“In global digital disruption,” Banking CIO Outlook states, “cloud innovation is rapidly becoming a fundamental driver and is gaining more prominence and cohesion with banks.”