Data Orchestration in the Cloud Powers Fast, Flexible and Secure Payments

Digital services have become par for the course in modern payments and banking.

Issuers, processors and acquirers are all taking note, particularly as the risks of relying on legacy infrastructure systems to power their networks are becoming more apparent in the face of emergent, cloud-based offerings that better support a future-fit suite of data and analytics capabilities.

“[Migrating to the cloud] brings forward a lot of leading-edge technologies that were previously relegated to new entrants,” Dondi Black, executive vice president and chief product officer at TSYS a Global Payments Company, told PYMNTS during a discussion with Eitan Ahimor, global payments business development at Amazon Web Services (AWS).

“It’s been really effective when we think about the opportunity for financial institutions to compete directly with new entrants to the sector,” Black said.

Ahimor emphasized that the “value in payments is being delivered to the end-user through the value chain,” meaning that optimal integration between payment ecosystem players is foundational to delivering value.

Because the information being exchanged along the payments value chain is comprised of incredibly sensitive data, it needs to be highly secured and encrypted both when addressed and in transit.

“When these workloads are sitting on a cloud, the payments players can effectively centralize their data in a secure and reliable manner that allows them to share it with the relevant parties who have the right permissions, providing access to the most up-to-date information in real time, which has the downstream effect of both more products being built and a better customer experience,” Ahimor said.

Cloud Technology Is a Leap Forward for Payments Infrastructure

PYMNTS’ research found that 92% of FIs are either currently innovating or have plans to innovate embedded finance experiences within their digital suites, with larger, international enterprises taking the lead, as they have a leg up when it comes to available resources and IT expertise.

“We are a global organization, as are many of our clients and their cardholders by extension,” said Black, adding that, “anytime you have the opportunity to not only share data, but manage that data, work with that data, and see the output of that in real time, the reduction of turn time [particularly across global relationships] yields benefits in terms of both operating efficiencies and also lower fraud.”

That’s because visibility across multichannel transactions and data management processes is a crucial best practice when it comes to ensuring compliance. A scalable risk management strategy frequently requires a single source of truth to identify and block vulnerabilities.

“When you think about how data analytics workflows are supported, stored and managed in the cloud, the opportunities, particularly in a global economy, cannot be overstated enough,” explained Black. “It unlocks a plethora of innovation opportunities to leverage new data partners in new ways to deliver better experiences.”

“And when you activate [data analytics workflows] using machine learning and [artificial intelligence (AI)] capabilities, it can be incredibly powerful in unlocking new opportunities for the payment processors to offer the issuers,” added Ahimor.

Cloud-Based Data Orchestration Can Create a Beautiful Symphony

Black emphasized that the concept of orchestration is “the big value driver” for migrating data and analytics programs to the cloud, as it allows for the surfacing of insights across multiple, integrated portfolios.

“It actually is feeding across a complex distribution channel, then suddenly you start to see improved experiences that our clients are leveraging to cultivate organic loyalty,” she added.

Given these benefits, it’s clear that outdated core systems can keep organizations stuck in the past and hamstring future growth. Businesses must have a seat at the table in order to eat.

“There’s no question [cloud is] the future of the industry,” Black said. “There’s an obvious recognition and appreciation for the value that hosting data and analytics platforms in the cloud brings.”

She explained that by building an effectively orchestrated, cloud-based data and analytics program, firms can realize future-fit efficacies by leveraging “all those attributes and elements interacting with the platform in the cloud in real time in a way that effectively rises the tide and lifts all ships.”

Beyond the immediate easy wins, by adding cloud-based microservices, firms can not only accelerate their innovation processes but also improve operations scalability without sacrificing security or interoperability.

“You really cannot underscore enough the superior control and security that cloud offers,” Black added.

“Another great opportunity for payments customers is shifting from monolithic code to microservices that unlock more opportunities and allow them to tap into more customer segments that might not need the whole pie but just a piece of it,” said Ahimor.

The elasticity of the cloud enables payment ecosystem players to “build and increase capacity when needed” without incurring high hardware costs, he explained.

Black also emphasized that beyond innovation, security and tapping into a data-driven flywheel effect, cloud-based data and analytics programs help firms manage “both sides of their balance sheet. Compared to the costs associated with hardware and legacy data infrastructure and equipment, the flexible cost of cloud computing is actually much more cost-efficient overall.”