While many banks and financial services companies are exploring and/or using cloud on some level, some remain hesitant to undertake a full-scale transformation.

In my last posts, I outlined the many challenges banks and financial services companies are facing today, and presented cloud as an essential, foundational element in their digital transformation. I also argued that, when employed as a business asset, cloud can help companies increase their agility and respond quickly to changing business needs.

In this post, I will take a look at the current status of cloud in banking and the financial services industries. In addition, I will outline some of the perceived barriers to cloud adoption that are holding banks and financial services companies back from reaping all of cloud’s benefits.

Cloud in financial services today

With so much discussion around cloud everywhere, it is easy to forget that it is still a relatively new technology, with the first commercial solutions dating back only 15 years. Banks and financial services companies were particularly hesitant to implement cloud solutions, due in part to security concerns.

However, things are changing, and recent years have seen a clear increase in cloud adoption.

According to the Accenture 2017 Global Risk Management Study:

82% of surveyed banking respondents are using cloud in some form.1

38% of these banking respondents look to cloud to drive greater operational efficiency and productivity.1

But although cloud has become the default choice for both new applications and legacy enhancement initiatives, many banks and financial services companies are using cloud to improve their current systems and operating models, rather than using cloud as the basis for a more fundamental transformation.

Perceived barriers to cloud implementation

Why do banks and financial services companies remain hesitant to go all in on cloud?

The reason may very well be related to risk and security issues associated with public cloud solutions. The good news is that most of these issues have already been addressed effectively by major cloud providers.

Take a look at the figure below to see some common concerns and how major cloud providers have responded.

“Security and regulatory compliance perceptions associated with the cloud”.2,3
Sources:
Moving to the Cloud—Creating a Cloud-Based Strategy for Banks and Financial Services Companies in North America. Accenture, 2017.
The great IT myth: is cloud really less secure than on-premise? Information Age, March 9, 2015.
20 of the greatest myths of cloud security. CIO.com, May 13, 2015.

 

In my next post, I will discuss the many possible paths to the cloud.

In the meantime, take a look at the full Moving to the Cloud—Creating a Cloud-Based Strategy for Banks and Financial Services Companies in North America report. You may also be interested in the Accenture 2017 Global Risk Management Study Executive Summary, and the Accenture 2017 Global Risk Management Study – Banking Report.

 

References:

  1. Accenture 2017 Global Risk Management Study – Banking Report. Accenture, 2017. Access at: https://www.accenture.com/ca-en/insight-global-risk-study-banking-2017.
  2. The great IT myth: is cloud really less secure than on-premise? Information Age, March 9, 2015. Access at: http://www.information-age.com/great-it-myth-cloud-really-less-secure-premise-123459135/.
  3. 20 of the greatest myths of cloud security. CIO.com, May 13, 2015. Access at: https://www.cio.com/article/2922374/cloud-security/20-of-the-greatest-myths-of-cloud-security.html.

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