We all know how things have changed for bankers, financers and consumers in just a couple of years. Besides, the digital age has steered banking and finance institutions to embrace cloud computing. Quite a few of the major organizations and start-up firms in the world are already running their services on cloud.
I should say, those organizations have realized the importance of high speed and connectivity, and grabbed the baton to leap ahead of customer expectations.
Why move from the traditional IT services?
It took almost a decade for the banking and finance sector to come out of inhibitions and try out technology. They were mostly concerned with the security of cloud computing and the regulatory constraints that it might bring along. But once cloud computing was implemented, it changed the financial landscape. Administrators couldn’t walk away from the flexibility and lenience of the technology. Cloud computing in financial services entered and expanded every niche amenity, from lending to transactions.
The technological innovation made financial services easily available to their users. It even reached un banked consumers across the world. And certainly, those measures increased their customer reserves.
Now, with more and more firms already taking up cloud services, platform and infrastructure support, traditional systems are finding it difficult to compete and keep up. Even large and credible banks are finding it difficult to retain or add customers who are pleased with the new service experience in other banks.
How does cloud help in banking?
Customers are happy to reach their banks anytime and anywhere now!
Bankers and financers too are happy because cloud-based solutions
Have definitely broadened flexibility in dealing with the complex nature of banking and finance services.
Are of course scalable and helps in estimating and achieving cost efficiencies.
Provides agility in moving to explore new business opportunities and markets (bankers needn’t wait to open up a new branch anymore)
Saves all the infrastructure, hardware, software and data storage costs.
Gives the opportunity to customize and better the organization’s platforms.
But are you ready for cloud?
Here is where the new phase of risk management comes into action.
With evolving cloud-based technology and businesses, there is a need to take risk management to a higher level.
Analysts imply that the key concerns of cloud computing that should be dealt with are: effective compliance, reputation, credit, strategic and operational risk management. At present, the major perplexities in adapting to cloud-based applications are:
- Escalating cyber crimes threatening data integrity, security and privacy of systems and networks
- Exposure to liability caused by non-compliance, regulatory and data breaches
- Risks induced through third-party involvement and outsourcing
- Complexities of monitoring and auditing service providers
With adequate risk management and solutions, cloud services can be valuable to any aspiring financial and banking institution.
2014 is witnessing a steep rise in the acceptance of cloud computing across the financial industry. Investments in the solution are larger than ever and the technology is highly promising in terms of its growth but Risk Management needs to address all the major risks associated with it.
Maher has more than 10 years of experience working in the fields of Banking and Auditing.Before joining Grant Thornton, he was an Audit manager with Deloitte & Touche specializing in Financial Institutions audits.
Maher has 1 1/2 years of experience working in Deloitte & Touche LLP – USA. He conducted Internal Audit and Due Diligence assignments for a number of well-known companies in Jordan and USA.He has also participated in implementing and testing Sarbanes Oxley requirements for SEC companies.
Since Joining GT in 2008, Maher has supervised a number of Internal Audit Assignments for well known organisations in the region
Latest posts by Maher (see all)
- The Significance, Benefits and Pitfalls of Key Risk Indicators - January 10, 2015
- Are Risk Management Measurements and Metrics Important? - June 25, 2014
- Taking Finance & Banking to the Cloud – ORM Software for Banking Industry - May 25, 2014