Spending by financial service institutions on cloud computing is predicted to jump by more than three times to over $18 billion in the next three years
(AF) When it comes to cloud migration, financial services in Asia have been comparatively slow to commit. Where money is involved, the risks of digital transformation have at times been seen as outweighing the benefits. Not to mention, there has historically been something reassuring about a bricks-and-mortar premises. Until now.
Covid-19 has redefined what it means to be responsible or reassuring, the workplace and businesses has had to evolve. Technology has been preparing for a shift of working practice for some time; we only have to observe the fintech space and the advent of shared office spaces pre-Covid, such as WeWork. The result has been a mass migration to the Cloud and the embracement of an ‘agile’ working theory.
In APAC, recent stats have highlighted that the public cloud spend of financial service institutions will grow by over three times from $4.9 billion in 2019, to more than $18 billion in 2024.
Cloud providers have responded swiftly to this increased demand with tools such as virtual desktops, VPN solutions and video call enablement.
The benefits have been two-fold: many financial services businesses have discovered a newfound ability to deploy more efficient and/or data-intensive processes and applications, and consumers are enjoying quicker transaction processing times and a mode of customer service more in-keeping with their 21st century lives.
The snowball effect
With most financial institutions in Asia now having at least some part of their estate or applications on the Cloud, the desire for expansion and ability to push forward new innovations is beginning to snowball. Of course, some firms are further along in their journey than others.
But regardless of the path financial institutions take, data will always have a few integral needs, which all data scientists are constantly trying to meet with more efficient and new processes. It must be delivered to the right place, at the right time, and in a preferred format.
Already, the Cloud landscape has undergone in its own mini evolution. Off-the-shelf Amazon-style access to data products is now possible via a web store or “supermarket”.
For example, AWS Data Exchange, one such ‘supermarket’ from Amazon, offers more than 1,000 data products from over 80 data providers, enabling customers to subscribe to, and access, data products with a click of a button. Google is following suit with Datashare and Snowflakes enablement of reader accounts, so the barriers-to-entry for clients looking to access data, storage and enormous computer resources are constantly being reduced.
New efficiencies on computers or serverless technologies put data users on standby so that they are not paying for what they do not use, changing the Cloud architecture paradigm. AI/ML teams are being introduced as a utility, not just something you read about in journals or online.
From satellites to the Cloud
Covid-19 has firmly consolidated the Cloud’s position as the data access point of the future, taking over from the internet, which saw firms dependent on satellites or lease lines for the delivery of market data. Firms can use the Cloud as a gateway into a physical data centre or on-premise, or use the data exclusively within the Cloud.
Thanks to this widespread migration to Cloud, financial institutions globally, but significantly in Asia, are more or less living up to their Covid-19 responsibilities through remote access capabilities, and customer service responsibilities through more efficient, often cheaper processes that match their digital-first lifestyles.
The next challenge, and one many are still struggling to surmount, is to ensure data responsibility, providing secure information access and a data protection guarantee. Firms that manage to walk the tightrope of maintaining data security while keeping employees productive and customers connected will be the winners of the Cloud evolution.