Sunday , 25 June 2017


Enabling Virtualized Banking Environments

– Diaz Ayub, Cloud Lead – FinTech Connect Virtualized Banking

At the outset it is important to understand where cloud will fit into the existing banking landscape and in order to do so, one must first recognize that the biggest development of recent times is the complete transformation and virtualisation of traditional banking services.

Emphasis is on the digitization of products and services; this totally changes the customer experience, allowing the customer to access all bank services anywhere on any device at any time. The digital trend has forced banks to re-examine their approach and the new strategy focuses not only on optimizing online marketing channels, but also social media integration and other touch points that today’s tech-savvy consumer engages with.

The cloud is now a growth driver for financial institutions, rather than a medium just for bringing costs down. Investments in SaaS mode solutions are largely to simplify operations, aid better product development, expedite product launches and rapidly enter new markets. Based on my personal research it’s clear that SaaS will radically yet positively change the financial services provisioning landscape.

Financial institutions face increasing pressure from new competitors, tighter regulatory requirements, and highly sophisticated and demanding customers. As a result of this financial service providers are creating more context-aware solutions by analyzing the typical actions executed by their customers and patterns of use, all the while investing in creating a frictionless user friendly digital experience.

Knowledge is power and the banks know this, I personally feel that behaviour analytics benefits the financial services sector far more than any other, why ? because banks tend to have long and in some cases lifelong relationships with their customers and longevity means profit. Only now are FI’s realizing that the cloud can create efficiencies and protect their competitive position, SaaS mode applications seem to be at the top of the IT departments shopping list and currently is the application mode of choice for an estimated 42% of banks.

From a viability perspective it is important also to understand that Public Cloud is not as unsecure as people might thing, and that is because of the huge investments in data centres, taking into consideration the miniscule investment of $8.6 billion Microsoft made in 2011 for Cloud R&D or perhaps the $1.2bn investment which IBM were aiming to make earlier in 2014 there is a clear trend or even appetite for the several technology leaders in this space to invest heavily in having accredited data centres so that they can be used by all types of businesses with focus on financial services.

A typical theory about the Cloud is that it is unsecure and not usable for the banking and investment sectors or any other which have strict compliance guidelines to be followed. This is definitely not the case, and more and more banks and other highly regulated sectors have been investing in the Cloud over the last few years and even more encouraging is the fact that regulators want to work with innovators to aid them in tailoring a solution that fits the regulatory guidelines. Increasing efficiency and reducing annual security investment will prick the attention of any enterprise so it’s understandable that banks want to embrace cloud models of technology.

So what will the banking environment look like in 5 years, my guess is that the number of physical branches will reduce drastically as virtual environments become the new way to bank. Who has time to queue up for a cashier or a customer services manager, wouldn’t you prefer a sophisticated online or virtual channel that’s quick, frictionless and most importantly saves valuable time?

In his position at FinTech Connect Diaz champions the role of cutting edge technologies in next generation banking ecosystems. Working in a strategic and business development capacity, he works with scores of leading fintech companies to ensure that their products and services get the optimum level of exposure with financial institutions the World-over. Diaz has strong relationships with leading international financial service providers and is active in advising them during their technology partner procurement phases. 2 Diaz is a community builder, a passionate networker and a true fintech enthusiast. Global blue chip solution providers turn to him when establishing effective business development and product marketing strategies. In his current capacity Diaz is responsible for creating and growing a world-wide portfolio of forums focusing on cloud modelled IT services for financial institutions. www.cloudbankingworldseries.com diaz.ayub@fintechconnect.com uk.linkedin.com/pub/diaz-ayub/26/985/49b

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