Cloud computing is no longer just a topic of conversation for CIOs. It has become a top priority for IT leaders, C-suite executives, and board members. Discover how the cloud can act as a catalyst for business transformation in enterprises, and a potential game-changer for the financial services industry. Explore how cloud computing can shape the future of financial services operations.

Cloud Computing: A Catalyst for Banking Transformation

The banking industry is evolving rapidly, driven by changing consumer expectations, emerging technologies, and alternative business models. To stay ahead of the curve, banks must develop strategies to prepare for the future. One important trend to watch is the increasing importance of cloud computing. Cloud is no longer just a technology, but a destination for financial services firms to store data and applications and access innovative software products.

Cloud providers offer a wide range of products-as-a-service that enable banks to improve revenue generation, customer insights, cost containment, and deliver market-relevant products quickly and efficiently. Cloud technology also presents a massive opportunity for banks to break down operational and data silos, helping to synchronize the enterprise and drive integrated insights through advanced analytics.

According to Deloitte, rather than focusing solely on cloud technology as a cheaper and more efficient data storage solution, bank leaders are now leveraging cloud technology in three areas "Above the line" to create new business frontiers, and in three areas "Below the line" to optimize the organization. By applying cloud technology in these six areas, banks can drive improved business performance and shareholder returns.

"Above the line" - Exploring new business horizons

• Enterprise synchronization

With cloud computing, files are always shared and synced across different devices. As a result, businesses can achieve better integration among their units, facilitate collaboration through shared platforms and tools, and enable faster decision-making processes. This results in a more efficient flow of information, deeper insights, and improved analytics, ultimately leading to better solutions for customer problems.

• Foster business innovation

Fostering a culture of innovation and driving strategic initiatives to develop novel customer experiences, optimize operations, and manage talent by leveraging tools such as machine learning, IoT platforms, and virtual reality. Harnessing these new tools and capabilities to improve revenue generation, reduce costs, enhance operational consistency, and boost employee retention.

• Empower innovative talent and modern work practices

Matching the technology with the needs of the business units can support modern work practices and attract specialized talent. With technological capabilities and solutions, organizations can improve processes like automation and human augmentation, leading to higher productivity and integration. This boosts agility, connectedness, and transparency, allowing businesses to react promptly to customer needs and market conditions.

"Below the line" - Optimizing the organization

• Establish Resilient Operations

By moving away from traditional data centers and leveraging cloud technology, organizations can build more resilient operations that enable them to respond quickly and effectively to physical outages, disruptions, and other unexpected events. With the ability to replicate data and application services across multiple data centers or regions, businesses can ensure that their critical systems and data remain accessible and available even in the event of an outage or disaster.

• Strengthen IT security

Cloud providers adhere to rigorous security standards. However, maintaining high levels of security in cloud environments requires proper implementation and expertise in security protocols. When done correctly, cloud solutions can provide security measures that are as robust or even more robust than those available with on-premises solutions.

• Adjust computing costs dynamically

Cloud computing enables organizations to shift away from heavy upfront capital spending and move towards operational-based costs. This allows companies to be more agile and responsive to market changes.

An enterprise-level solution

Moving from an on-premises data center to an enterprise-level cloud solution can be a daunting task for the business units and IT executives. However, banks can adopt a cloud transformation strategy incrementally, mixing and matching hybrid and multi-cloud solutions based on their needs, maturity, and readiness. A multi-cloud approach is a popular choice for most organizations. Regardless of the deployment model, data stored in the cloud can be just as secure, if not more so, than on-premises storage.

Cloud deployment models

There are various cloud deployment models available to companies, allowing them to choose a mix of solutions that align with their needs. These models range from full cloud deployment to hybrid solutions that combine both cloud and on-premises systems.

Planning and Implementing Cloud Solutions

• Set goals

Cloud computing not only revolutionizes IT strategies but also drives the development of new services to achieve business goals. Before implementing cloud solutions, enterprises need to set specific targets for the system. You need to clearly identify the purpose of using cloud solutions, such as increasing work efficiency, reducing costs, increasing flexibility, improving security and system reliability, etc. This will be the basis for designing and implementing a suitable cloud solution in the future.

• Solution Design and Execution

After setting the objectives, businesses need to design and implement cloud solutions. This is an important step to ensure that the solution is deployed properly and meets the system's requirements. You need to identify the system requirements, necessary features, ensure compatibility, and develop a strategy to optimize the performance of cloud computing.

• Vendor Management

After deploying a cloud solution, businesses will need to manage their providers to ensure stability and security for the system. You need to clearly identify the individuals or units responsible for managing and supporting the cloud solution, establish rules and policies to ensure the security of the system. The business can also consider applying a multi-cloud model by working with multiple providers to optimize the strengths of each provider as well as avoid dependence on a single provider.

• Security

Data security is certainly a top priority for banks. Cloud computing solutions can help address vulnerabilities that traditional infrastructure cannot detect. While cloud providers are responsible for securing the underlying infrastructure, businesses still need to establish security measures to ensure the safety of their systems, such as updating security patches, monitoring and early detection of issues, ensuring data integrity, etc.

• Regulatory Compliance

Cloud computing, especially domestic providers, can help banks comply with legal requirements, such as Government Decree 53/2022/ND-CP on data localization in Vietnam, Decree 13/2023/ND-CP on personal data protection, etc. Complying with regulations on data and security is necessary to ensure that the organization is operating legally and protecting customer data. In addition, the organization must also comply with information security regulations to ensure its legal compliance and responsibilities.

In conclusion, cloud computing has become an increasingly popular strategic business driver in the financial services industry. The benefits of cloud technology, such as scalability, cost efficiency, and enhanced security, make it an attractive solution for financial institutions looking to transform their IT infrastructure and improve their overall operations. By taking a careful and strategic approach to cloud adoption, financial institutions can unlock the full potential of cloud technology to drive innovation and growth.

At VNG Cloud, we provide professional cloud computing solutions with high scalability, security, and readiness for the finance-banking sector. We also offer a cloud-based camera solution to proactively ensure security at service counters and ATMs. Learn more about VNG Cloud's solutions for financial institutions here.