How does the Cloud help banks reduce risk from fraud more effectively?
Cloud computing has effectively changed the way businesses work in most sectors. The changes brought enterprise business transformations and better customer experiences. One would assume that with the enormous number of technological advances and endless possibilities, this is the future for all businesses. However, the financial services industry is still sceptical about this change. Being one of the most regulated industries, the scepticism may be justified.
While many banks have already started exploring the multiple possibilities of the Cloud, aspects like safety and security are being studied. There is always the aspect of resistance to change to be considered too. Banks have been comfortable with their data being on-premises, giving them a sense of control. It is now slowly sinking in that being on the Cloud need not in any way mean a change in this aspect. Rather, Cloud providers offer multiple levels and means to control the storage and access of data.
This benefit comes along with many other advantages such as better synchronization of the complete enterprise data, and faster and better responses. These ensure that operations are more resilient and there is business continuity even in case of disruptions. The Cloud opens up possibilities of new business and employment models and enables process automation. This is why winds of change are on the cards.
The future of banking
The banking landscape is changing and industry leaders within are acknowledging it. There is a need to meet customer expectations and leverage the power of the Cloud and associated technologies. The call is for a fine balancing act to change mindsets. One must be careful not to compromise safety and regulatory expectations while getting into the new game.
As it happens, the Cloud is now much more than just a storage destination. It is a combination of technologies and services that are fast becoming so advanced that even the banking industry stands to benefit a lot.
The need is to move from legacy on-premises to Cloud and take advantage of the computing power and the tech-tools. Together, they provide greater transparency, speed, and additional monitoring and safety to banking transactions. Banks need to strategize new business models powered by these technologies to bring products as a service to improve revenues.
In the long run, this will also prove to be cost-effective and ensure speed, accuracy, better monitoring and customer satisfaction. Additionally, banking involves a whole lot of insightful data across silos such as finance, regulations, risk, customer support, and more. Having access to this enterprise data in a combined form can completely transform banking through actionable insights aimed at improving operational efficiency.
How to reduce risks
Risk management is one of the major attributes of the Cloud. Banks can ride on this encouraging factor and adopt Cloud computing. Cloud providers adhere to high security standards, which need to be implemented after a thorough scrutiny. Every aspect needs to be discussed, understood, and adapted as per individual suitability. There are various measures to implement security, including that of meeting the required regulations.
The combined effort of banks and Cloud providers can actually help monitor and detect risks and vulnerabilities better. Large amounts of data can be processed faster to arrive at potential issues that may be plugged before they cause concern. Fact also is that regulations keep evolving, and they differ across multiple jurisdictions. Cloud-based tech tools can easily help manage these changes. Reduced time to respond to potential risks and vulnerabilities is essential to maintaining customer trust and integrity in the banking industry.
The Cloud provides banks with another significant advantage. It gives immense computing power, which is accurate and precise in detecting fraudulent or potentially suspicious transactions. Many Cloud providers include fraud detection tools and fraud management solutions as part of their services. These tools offer much better security than what the on-premises security systems do. They are also more effective in proactive fraud detection and thus enable more agile decision making.*
Banking risks are typically credit, market and liquidity, frauds, and cybersecurity. The Cloud providers have multiple services to anticipate, assess and beat these risks. Offerings like platform-as-a-service, infrastructure-as-a-service (IAAS), software-as-a-service, products-as-a-service, business process as a service etc. provide banks with a lot of versatility, without compromising on security. With a few banks having already taken the plunge, it is just a matter of time before the Cloud engulfs the banking industry fully. Hopefully, with fast-emerging, reliable technologies, these can help fuel the transformation towards better banking for all.
* For organizations on the digital transformation journey, agility is key in responding to a rapidly changing technology and business landscape. Now more than ever, it is crucial to deliver and exceed on organizational expectations with a robust digital mindset backed by innovation. Enabling businesses to sense, learn, respond, and evolve like a living organism, will be imperative for business excellence going forward. A comprehensive, yet modular suite of services is doing exactly that. Equipping organizations with intuitive decision-making automatically at scale, actionable insights based on real-time solutions, anytime/anywhere experience, and in-depth data visibility across functions leading to hyper-productivity, Live Enterprise is building connected organizations that are innovating collaboratively for the future.