12-27-21 | Blog Post

3 Reasons Banks Should Move to the Cloud

Blog Posts

Financial institutions are quickly learning that the future of banking is in the cloud. To stay competitive, improve security, and provide more diverse service offerings for end users, financial institutions will look to the cloud for solutions. Banks have traditionally been slow to move to the cloud due to security and compliance concerns but as of recent, have begun to fully understand the full potential and benefits of the cloud. Confidence in the cloud has skyrocketed as of recent thanks to improved levels of security and compliance associated with cloud strategy.

Security and Compliance

Online banking through mobile apps and laptops poses serious security concerns for financial institutions. Customers require instantaneous access to banking information and expectations will only continue to grow. Financial technology will only continue to innovate as it adopts to meet these customer demands, but so will increased security concerns with these new applications. Cloud applications, platforms, and infrastructure improve security with end-to-end encryption, authentication, and redundancy so that your systems stay up and running 24/7/365. With Security as a Service, of SECaaS as an offering to top it all off, you’ll be able to operate in the cloud with tranquility, knowing your strategy has built in excellent preparation for cyber-threats, human error, and more.

Financial institutions deal with sensitive information, like customer investment information, bank statements, addresses, etc. In the cloud, banks can find peace of mind with compliant cloud solutions, outlined in SLAs (service level agreements) and data center compliance standards.

Financial institutions can also turn to a hybrid cloud strategy. This creates flexibility where some operations run some systems on-premise and others in the cloud. Operations that involve a high level of security can be kept in house if your organization wishes, and other lower-security operations can be moved to the cloud if desired.

Reshape Operating Models

A move to the cloud normally allows banks to make a fundamental shift away from capital expenditures (CAPEX)  to operating expenditures (OPEX). Expensive, upfront capital expenditures are normally required to build, update, and expand a data center. Moving to the cloud allows financial organizations to adopt an operating expenditures model, where monthly expenses can be better managed with premium scalability, uptime, and reliability. This means cost savings!

Managing branches

Most banks have branches in distant locations or even overseas. Cloud computing allows branches to utilize the internet to access shared hardware, software, and related services, all on demand, from powerful computers based in remote locations. Accessing big data, computer applications, and shared communications resources is a major advantage for banks looking to better link together all of their branches.

The Bottom Line:

Financial institutions looking to get ahead of competition should look to move operations to the cloud. Improvements in cloud security and compliance make cloud-based strategies more lucrative and appealing to financial institutions. There’s no doubt that the future of banking will be in the cloud.

Did you know? Otava is a Corporate Member of the ICBA (Independent Community Bankers of America), promoting safe environments where banks can flourish and create sustained growth.

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