The future of your bank is in the cloud, but: in what way?

By 2024, 40% of banks will have started their cloud migration*

The main motivation for many organizations to be in the cloud was to reduce operating costs, currently it's about generating revenue.

According to a survey conducted by the consultant Capco To leaders of financial services organizations, the two reasons for a bank to be in the cloud are: to obtain higher revenues and to have a higher future return (52%).

But what is being in the cloud or why should a bank migrate?

The reality is that the advantages are many. I'll start by listing them and then talk to you about the alternatives that exist.

1. Flexibility.
Basically, it's about being more flexible than the physical infrastructure allows. And also, not having to have an internal team dedicated to maintaining it.

And combined with flexibility, there is growth.

For example, if you wanted your bank's operation to grow by 50% and it would work in the cloud, in any of the available models, you would only have to pay more and the next day you would have what it takes to achieve your goal.

But if your bank's operation works under the modality On-Premise, meaning that it uses its own IT infrastructure, first of all you would need to purchase more servers to increase your level of operation.

Of course, you should take into account that there is currently a shortage of containers and a delay in ships, so getting the servers can take months, to which we would have to add the time required to generate a solution based on the new infrastructure.

In addition, the cloud is elastic, so during peaks of demand, a bank can guarantee the good performance of its service, since it is not limited by physical infrastructure.

2. Drastic cost reduction.
You don't have to incur a large initial cost of infrastructure: hardware and software, but rather a modest ongoing operating cost that can also be adjusted according to peaks in demand. Cost reduction refers to both the hardware and the staff dedicated to maintaining it.

3. Business robustness and security.
Since the provider is responsible for ensuring that the service is offered without interruption, your bank guarantees that it will have greater protection of its data and faster solutions for faults and errors at a lower cost. In addition, these types of solutions continuously update their security parameters to prevent cyberattacks.

4. Focus on business.
Since your bank can move non-critical services to the cloud, it can focus on Core of the business: financial services.

5. Care for the environment.
The use of cloud computing reduces energy consumption and, of course, reduces the carbon footprint.

How to adopt cloud computing

There are 3 ways for a bank to be in the cloud and which, in a certain way, can also be considered stages of the virtualization process.

1 - IaaS (Infrastructure as a Service)).

It's probably the easiest and fastest way to virtualize a bank's On-Premise infrastructure. This modality allows a bank to use cloud storage without the need to purchase, manage and maintain virtual infrastructure.

This means that the bank, or other vendor, manages the operating system, data, applications, middleware, and runtimes. Microsoft Azure and Amazon Web Service (AWS) are the most used services to implement the IaaS modality.

Basically, the software that is currently used is transferred to operate in the cloud.

2 - PaaS (Platform as a Service)).
It's another step forward in virtualizing a bank's infrastructure.

Under this modality, the bank takes advantage of development and implementation tools to generate and execute its own applications, but without designing or maintaining the infrastructure.

It not only has virtual space, but also the use of certain platforms.

3 -SaaS (Software as a Service)).

Under this modality, you don't pay for the infrastructure but for the use of the service, the technology that allows users to transact.

Deciding to switch to the SaaS model does not depend exclusively on technical considerations but, rather, commercial, since operating under this model has to do with deciding what type of relationship your bank wants to maintain with its provider.

However, it is important to know that a bank can choose a Multi-tenant SaaS (multi-user) or a Single-tenant SaaS (private or single-user).

What's the difference? That in the case of multi-user SaaS, there are several banks or financial institutions that will be using the same platform, so differentiating is almost impossible.

Functionality will be shared with all other banks that use that system.

And then?

Private SaaS: The way in which Infocorp helps banks to evolve technologically while maintaining their branding and commercial strategy.

In the event that your bank hires a Multi-tenant SaaS customization is not possible since all customers of the service are under the same installation and, therefore, they all access the same functions and features.

In other words, your branding is compromised because you can't make adjustments that help the bank differentiate itself from the competition.

In the case of a Single-tenant SaaS, or private Saas, like the one we provide at Infocorp, there is a specific implementation for a specific customer, so it is absolutely customizable according to the needs of each bank.

In private SaaS, there are benefits that the bank obtains and that are then transferred or enjoyed by users. For example, software updates can be performed in an automated way, such as updating a version of an SQL or a virtual machine, without interrupting the service for the user, as is the case with the On-Premise mode.

With a private SaaS at Infocorp, we take care of both the infrastructure and the administration of the service.

At Infocorp, we are ready to accompany you whatever option you choose for your bank, offering both the possibility of using the cloud infrastructure contracted to a third party and to carry out the migration and implementation directly. Let's talk, and let's go to the cloud together.