While cloud computing and services are becoming more and more popular, some industries are hesitant to jump on the bandwagon. Financial technology, or FinTech, is one of them.Working in FinTech, your #1 goal is to improve and automate the delivery and usage of financial services for banks, equity firms, and other entities within the industry. You work to provide the right technology and process setups to keep financial operations running smoothly. According to the New York Times, large banks and firms often use their data systems to store and manage their vulnerable data, like customer information and logs of their trading activity. This has always seemed safer because it allows financial institutions to keep their records in-house. In the past, FinTech has provided solutions to continue maintaining these data centers.
But unfortunately, this can eventually become a costly investment. Data centers need a large amount of energy, electricity, and air conditioning to be kept running and can only be accessed onsite through the institution's public network. It also leaves institutions in charge of their own cybersecurity.
More and more, FinTech companies are being persuaded to transition to cloud computing solutions that can offer new capabilities for their clients. So let's take a closer look at those features:
Today's banking customer depends on wireless communication and transactions more than ever. This means that the pressure is on FinTech to collect, process, and distribute data quickly and successfully to meet the needs of your clients and their customers. This could include assessing client behavior analytics, simplifying and streamlining transactions, and creating a more widely accessible financial services network.
As you can imagine, this results in your FinTech organization and banks having a high volume of valuable data that needs to be stored securely. That's where cloud computing comes in. It's able to:
- Collect and store the large amount of data that FinTech and financial institutions have.
- Merge and centralize data from multiple platforms, making it easily accessible by both employees and end-users.
- Automate systems that take up unnecessary time, streamlining repetitive processes and eliminating the likelihood of errors.
- Offer increased flexibility when it comes to personalizing platforms and systems.
- Boost cybersecurity measures.
- Optimize customer service, allowing employees to access customer data and complete transactions remotely quickly.
- Extend its capabilities past the cloud platform to other payment gateways like banking apps and digital wallets.
When caring for in-house data centers, FinTech and banking institutions are likely focused on keeping those systems running smoothly and avoiding potential threats. Unfortunately, that means less time and energy to spend looking for new capabilities to improve those systems. As a result, while their data centers could be running successfully, there's a chance they're lacking the agility of cloud computing software.
Agility defines a software's ability to adapt to the latest trends and innovations in the technology world. Staying agile means that organizations can keep in lockstep (or ahead!) of competitors while offering the latest and greatest services.
If FinTech entities and banking institutions are focused only on their in-house process, they won't be able to keep up with the changing landscape. By investing in a cloud computing platform, they can skip the stress of missing out on the latest industry modernizations, knowing that their platforms will continue to update and grow without intervention.
Financial institutions are one of the top three industries most at risk for a cybersecurity attack. The Conference of State Bank Supervisors recently asked community banks about their primary concerns. Of the 571 banks questioned, more than 70% of respondents said they were most concerned about cybersecurity.
A cyberattack can be devastating in several ways for financial institutions. Of course, there is the chance of losing funds and vulnerable data to hackers, but those institutions are also likely to lose customers. So, for FinTech, keeping their banking clients' data secured is of utmost importance.
Cloud computing and software can severely reduce the likelihood of a cyberattack and mitigate the effects if one happens to occur. Paired with next-level detection and monitoring solutions, potential breaches can be found early, keeping vulnerable customer data safer. In addition, cloud software can be set up to automatically install any updates needed to fix bugs or loopholes in their security system, so you'll never miss one.
As a FinTech entity or banking institution, it's crucial to consistently ask, "Are our data storage methods able to perform effectively even as our business grows?"
If you're not working with a platform designed for flexibility, the answer is most likely no, which can be a big issue. For example, if a financial institution grows faster than its data management and storage platforms can handle, that can easily hinder an organization's efficiency.
The public cloud is designed to be scalable and elastic. This means that they can be customized to an institution's needs - for example, increasing or decreasing storage options. If an institution were using multiple platforms or an in-house system, this process would be much more difficult. It would require working with each platform to upgrade or downgrade subscriptions while finding the right customizations based on the institution's changing needs. But with everything centralized in one scalable, personalized cloud home, the changes can be made quickly and effectively.
Considering the Cloud?
Customers demand more digital capabilities from their financial institutions in today's climate. They're ready to access their accounts, make transactions, and get assistance quickly, which means FinTech and banks need to adapt to those changing needs. Cloud software and computing are emerging as the best way to centralize, manage, and utilize this vital data effectively.
If your FinTech organization or banking institution is interested in transitioning to the cloud, Ascend Technologies can help. Our team is ready to facilitate your merge and customize your new platform to your needs.
Contact us today to learn more about our Cloud and Infrastructure Solutions.