Is Cloud Computing Promising for Financial Sector
When customers are willing to work collaboratively 24/4 mobility solutions on cloud comes to the aid of banking and finance sector.
Banking, insurance, and investment companies are in salvage mode. On the one hand their invaluable asset that is data is prone to hacking. On the other changing business dynamics throws up opportunities for financial services and asset management firms. Customers are connected 24/7 and businesses want to serve them from remote through mobile solutions. Mobility solutions are highly preferred in retail banking, regulatory compliance reporting where data is meaningfully used for informed decision making.
According to Sean O’Dowd, Global Financial Services Director, MAPR, Data governance, lineage, and other compliance aspects will become more deeply integrated with big data platforms. Why banks are least loved by the Millennials? The answer is a lack of mobility solutions. According to Millennial Disruption Index, 73% of Millennials would be more excited about a new offering in financial services from Google, Amazon, Apple or PayPal than from their own nationwide bank. The message is clear – if banking and finance segment will not respond to mobility solutions they will be replaced by automated solutions.
Paper currency, computers, and of course 9-5 working hours with one to one customer interaction are being replaced by digital technologies. Demographic and gender segmentation show the power of two sets of people who cause a big disruption in banking. According to a study by Stephen Horan CA Institute women control half of the wealth in the U.S. and are going to control two thirds of wealth by 2020. Another wealth management trend indicates Gen Next and Millennials together will control half of the investable assets in the U.S. by 2020. Do banking and finance segment have action plans for these groups?
Big data and analytics are reshaping the mobility space. The age of intuition is over, fact driven decision making is in thanks to big data and analytics. Banks want to make analysis by analyzing facts. Robust frameworks are required to meet customer preferences, thereby avoiding the prospect of competitors eating into market share. For that financial services sector requires secure and compliant framework that covers end to end processes. It is at this stage mobility services on cloud comes to the aid of retail banks and financial institutions. Today, consumers are more empowered thanks to State regulations. For example, Dodd-Frank Wall Street Reform and Consumer Protection Act prevents mortgage companies and payday lenders from exploiting consumers." Due to this act, financial services are changing the way they run business. To address this challenge banks need prebuilt frameworks.
Data security is another threat that makes financial enterprises to view cloud migration as risky. Financial IT service providers respond to this challenge by stating that by being compliant with Health Insurance Portability and Accountability Act (HIPAA), deploying the cloud in secured environment by providing another embedded layer, data hacking can be prevented to a greater extent. Cloud computing for financial services, providing mobile application enterprises for the customers, financial companies can ease payment processing and risk management leading to credibility growth as well as bottom line growth.
Key functions like advisory services, advanced analytics, market data, and research can be implemented across a diverse range of mobile platforms and device. Finance mobility solutions include regulatory compliance reporting. Today compliance reporting has a broader risk management framework like risk appetite statement, risk reporting, etc. Traditional compliance model relied on a siloed legacy IT systems. Lack of automation in compliance reporting leads to cost escalation. As a response to this challenge finance and banking technology, mobile application developers suggest automation with cloud enabled applications. Cloud computing is promising for financial sector if they can effectively address information security issues.