Hybrid cloud is allowing banks to harness the power of the cloud while maintaining security, performance and compliance. Here’s how…
In an age of big data, few sectors have as much to gain as the financial services.
It can help personalise their service offerings, manage their own finance and improve compliance.
However, many have not been able to take advantage. After all, financial services is subject to a unique combination of compliance, latency and security requirements.
A recent survey from the Cloud Security Alliance highlights the challenge.
Banks and insurance firms might be aware of what the cloud can do for them, but they are still searching for a cloud strategy. No single option offers a one-size fits all approach. None of the respondents were planning to use the public cloud, while only a fifth intended to go fully private. Instead it would be a mix of different options.
Their reasoning? Banks need to consider a number of different factors including:
- Regulation and compliance: Companies in the financial services sector are highly regulated. Not all cloud operators are compliant with data protection laws.
- Latency: Any delay can be deadly for a sector in which the landscape can change in less than a second. A hybrid cloud allows companies to map different tasks to different services.
- Additional infrastructure: Any new capacity can be purchases within a matter of minutes via a public cloud; there is no need to buy new equipment or take tie deploying a new server.
- Innovation: Public clouds are a simple and affordable testing environment for new ideas and help banks role out new products and services much more quickly.
- Security: Public clouds are inherently vulnerable to attack, especially given the increasing sophistication being seen among cyber criminals. Certain data will need to be housed within a secure environment.
When transferring digital payments, companies rely on services which are fast, secure, consistent and reliable. To do so, many are turning to internet as a service clouds, but for reasons of security it is also a good idea to continue using traditional payment structures. By using the hybrid cloud model, they can spread the workload across different networks, take advantage of the enormous computing power on offer via cloud partners, and maintain security and compliance.
“In recent years, hybrid cloud services have matured into secure end-to-end platforms for financial services companies looking to support their core production applications with automated, cognitive technology,” said Gary Meshell, Global Sales and Business Development Leader for IBM Financial Services Security. “With the right standards and regulatory alignment in place, hybrid cloud can effectively replace legacy on premise infrastructures as a viable, secure and efficient option for financial services.”
He was commenting as IBM unveil their top security issues for banks. These include regulatory compliance, access management, standard security frameworks and application security. All these will have to be addressed within a secure hybrid cloud framework.
The cloud, then, is an option with enormous potential for banks, but with all sorts of challenges. Until now those have been enough to hold financial institutions back, but developing an effective hybrid cloud strategy allows banks to maximise the opportunities while minimising their risk.