The cloud is all around us today; Quite literally! It is one of the most disrupting present-day technologies which is being adopted at a record pace by enterprises of all sizes. It brings great agility and efficiency to an organization. Thanks to the cloud, businesses are operational even during these difficult times when the entire world is fighting the novel coronavirus.
With the increasing penetration of the internet and smartphone, it is no surprise that all industries, including banking and finance, are moving towards the cloud.
As per Gartner, nearly 94% of the enterprises are using some cloud-based service or another. Further, it predicts that almost 83 percent of enterprises will be moving their workloads to any of the private, public, or hybrid cloud by 2020.
What is Cloud Banking?
The delivery of banking services over the internet (the cloud) is known as cloud banking. It is one of the most disrupting technologies in the financial sector, enabling banks to deliver 24/7 services to their customers. Cloud-based services have proved to be a game-changer for all the data storage requirements of the banks.
The following are various benefits of cloud-based banking:
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Cost Efficiency
The typical, on-premise IT infrastructure upgrades demand a great deal of time and capital investment, whereas with the cloud, banks can scale up or down, as and when required, with the benefit of paying only for the resources being used. The cloud helps banks expand quickly and cost-effectively.
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Flexibility
In the current dynamic ecosystem, it becomes extremely important for banks to keep pace with the increasing demands of their modern, tech-savvy customers, who are 24/7 on their smart devices, consuming services round the clock. The cloud has made the banking services available for their customers to use at will. It has converted their smart devices to virtual banks, providing never-seen-before flexibility to the industry.
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Enhanced Data Security
Data is of extreme importance for any industry, even more so for the banking and financial industry. A small breach in security or a hardware failure can lead to both capital loss as well as reputation loss for a bank or a financial institution. Thanks to the cloud, banks need not worry about the security of their data. The present-day cloud hosting service providers incorporate state-of-the-art techniques like multi-factor authentication and data encryption to ensure complete security of the data. Additionally, the cloud offers effective data backup capabilities to ensure easy recovery, in case of a mishap.
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Agility
With the cloud, banks have easy and quick access to all the latest applications, without extra capital investment. It makes banks more agile as they are able to keep up with global competition and changing market trends.
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Innovation
The cloud also makes it easier and convenient for banks to make use of the latest technologies like machine learning, artificial intelligence, and robotic process automation for bringing in innovative solutions to the industry. RPA helps automate the data-intensive, manual tasks, whereas AI brings sophisticated customer interaction tools like chatbots. With the help of these technologies, banks can also evaluate credit card and loan applications without engaging human resources.
Conclusion
Cloud banking is a very beneficial and important step towards the realization of a digital economy. There may be some concerns, especially those related to the security of the financial data, but the utilization of the cloud seems inevitable. A cloud partner offering adequate security in addition to technical compatibility and regulatory compliance can help banks harness the true potential of the cloud, helping them achieve a great return on investment and bring the latest, customer-centric banking solutions
Author Bio: As a content strategist and writer associated with Sagenext, Vishwa Deepak does more than just stringing letters together into words. My core competency lies in producing useful and amazing content related to technology trends, business, cloud computing, Quickbooks hosting, and finance.