Cloud Banking

Cloud Banking Data Storage In The Spotlight

cloud banking

Here’s an eye-opener: Up to 1 in 5 customers in Italy, Spain and the United States are now likely to increase their online banking tool usage after the pandemic abates. Let that sink in.

Call it digital transformation or a financial services sea change, but cloud banking could not be better positioned for a touchless post-pandemic world of altered customer perceptions.

Digital Banks And The Power Of The Cloud Tracker® done in collaboration with NuoDB, looks at the rise of cloud banking, accelerated by the pandemic like many other trends, but with implications for the future of banking that will see entire swaths of the industry redesigned.

It’s also an opportunity to address long-standing data issues that shadow digital banking.

The bizarre events of 2020 “… are prompting banks to examine how they store and manage their data to secure it from fraudsters as well as which technologies can help.” Many financial institutions (FIs) “have considered moving sensitive information to the cloud, but this migration can create stumbling blocks for those that still utilize legacy core banking infrastructure,” per the new Tracker.

“One recent study found that 71 percent of the information stored on public cloud servers can be categorized as sensitive data, even though these services’ security measures are not as robust as those of private cloud solutions,” the Tracker states. “FIs’ struggles and rising fraud are also leading financial regulators worldwide to closely examine their data storage and transfer standards as well as what must be done to ensure that customers’ information and the cloud solutions hosting it are secure.”

Data Handling Pandemic-Style

Observing that “… the very foundation of all businesses is access to capital and the banks that lend it,” NuoDB Chief Technology Officer Ariff Kassam told PYMNTS, “When the world shut down to keep its citizens safe … banks were forced to quickly adjust their services by maximizing their digital capacity and leveraging cloud-based technologies.”

From remote onboarding experiences that actually worked to government aid disbursements, banks tapped cloud-based technology throughout the pandemic, Kassam said, “Using Kubernetes and containers to allow development teams to rapidly build and deploy solutions in the cloud,” and leveraging software-as-a-service to handle back-end functions, refined digital experience to service customers “on their mobile devices as effectively as if they were standing in a branch, working with a teller.”

Cloud benefits go beyond a great CX. “Many … FIs appeared to have adopted cloud solutions to beef up their protection measures” last year, with one survey finding that “94 percent of banks and businesses were utilizing more than one cloud provider. Eighty-six percent of survey respondents also said they expected their organizations’ cloud strategies and environments to evolve to address novel threats.”

Mobile Adds New Facet To Cloud Banking Data

Data compliance is as serious as it gets. Ask Google or any of the tech firms and FIs fined by the European Union (EU) and other agencies over policies at odds with new attitudes — and laws — concerning data privacy.

Perhaps it’s for the best. “FIs have long been favorite targets of fraudsters. One 2019 report found that 62 percent of the data stolen in online breaches that year came from FIs, even though many banks and businesses were tapping some form of cloud technology at the time.”

“The pandemic appears to be giving cybercriminals even more opportunities to launch their schemes, with 89 percent of U.S. consumers now using mobile banking applications to access their bank accounts,” the Tracker states.

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