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Fintech Companies Migrate to the Cloud

There’s no doubt about it. Fintech adoption is booming—global investment activity was valued at $3.2 billion in 1Q2017. Learn how the drive for fintech provides greater flexibility and faster delivery of traditional and innovative financial offerings to fintech customers.

The Cloud-ward Migration is Real

In the past, financial software focused on internal processes and operations. But then, device-carrying customers started to live their financial lives online. Presto! Forward-looking finance companies started delivering what their customers wanted, a mobile-first experience. More and more customers got engaging services that were convenient, fast and useful, anywhere there’s an Internet connection. 

Contactless payments, e-deposits, digital lending, capital markets and peer-to-peer payments. Life was good. As the crowds of enthusiastic mobile customers grew, so did the load on company operations. Gradually, core processes slowed, and concerns about security risks grew. It was time for a major change. 

Ten Ingredients of a Successful Migration 

The need to meet operational demands and customer expectations became the new challenge of fintech success. It didn’t take long for fintech companies to discover the scalability, flexibility and reliable operations that are key advantages of cloud services. Cloud services have a proven track record for fueling business growth. Agility—the ability to respond quickly to changes in business conditions and requirements—is the cloud’s most valuable capability, but many companies don’t know which capabilities they need to make cloud migration a success. What does it take to make the move successful? These ten, high-level capabilities hold the key to a successful move to the cloud:

Operations Capabilities

First, you’ll need reliable, well-managed operations, the bedrock of successful cloud migrations. Standard cloud capabilities enable administrators to:

1. Add or retire IT assets automatically. When you acquire cloud-based services, your operations quickly become more efficient and agile. Cloud auto-scaling capabilities add more servers to application stacks to handle higher operations loads. Businesses can reallocate resources in moments, without the distractions of finding a physical server that will have the required capabilities.

2. Provision IT resources from a single, centralized console. This approach makes it much easier for IT teams to deliver the right resources to the right project. For instance, creating a DMZ network is a much simpler job than configuring multiple network routers and switches.

3. Eliminate manual errors and related rework. Automating formerly manual tasks avoids human error and supports self-heal failures.

4. Use the latest security standards. Modern cloud infrastructures are designed and managed with modern security best practices and compliance standards.

Application Development Capabilities

Your developers are under constant pressure to deploy applications quickly, but the speed that your business requires makes it harder to bake security into your technology. Consumerization of finance fuels the need for business agility and innovation. To decision makers, this is a good thing. To app developers, it means something else: demand for a constant stream of more high-quality apps delivered more quickly than before.

Cloud-based services can reduce the load on developers, especially when they Adopt DevOps methods. Fintech companies rely largely on applications that access user financial profiles to perform many types of real-time service transactions. 

The finance sector was an early adopter of DevOps. Its importance is still on developers’ minds today. In a survey, 87% of firms affirmed their reliance on DevOps. As a continuous release model, it enables developers to meet consumer demand for updated features and improved user experience on a shorter development cycle. 

Security and Compliance Capabilities

Concern about potential security shortcomings in network core processes is nothing new. Watching security performance in hosted environments is. To reduce the risk of breaches and their related problems, it’s crucial to engage cloud services that:

1. Focus on data and process visibility. Visibility is the key underlying measure to minimizing security risks; 95% of financial organizations surveyed consider visibility into what’s going on in their IT environments to be a critical part of security.  

2. Monitor for unauthorized access and account hijacking. Currently, these are the top data security threats.

3. Use advanced security methods. To secure financial data, firms need to implement internal segmentation, cloud access security brokers and other measures to integrate industry security standards. They also must be sure to enable these integrated defenses with automated threat intelligence. 

4. Stay in communication with regulators. Cloud-based data management and unified communications services can help finance companies stay in touch with regulators. Recent regulations include several directives written to improve communications with regulators and to increase process transparency to reduce future risk.

5. Orchestrate company-specific requirements. Cloud services can help finance companies group, prioritize and perform scheduled compliance-related tasks. 

Value of Moving Fintech to the Cloud

Each year, more banks and financial services companies use public cloud infrastructure to: 

  • Cut operations costs;
  • Speed up application development;
  • Redirect spending toward innovative projects;
  • Position themselves to be more competitive; and
  • Forge partnerships with cloud-based providers.

Discover how public cloud infrastructure can helps your company seize opportunities in your market. Contact us today!