How to harness the cloud and transform financial services

The financial sector is in the throes of a substantial upheaval. In the face of competition from their FinTech and platform-based rivals, traditional financial institutions (FIs) are wrestling with these disruptors for supremacy. Adaptability is key to not being left in the dust by startups and digital natives, especially with digital experiences fundamental to gaining more and better customer data. However, this requires traditional players to rid themselves of legacy systems and outdated mindsets. It needs solutions that combine the power of the cloud with the desired hardware engineering expertise to provide satisfactory services to customers successfully. 

Cloud Technology for Hyper-personalisation

Indeed, many traditional FIs are already in the cloud and will continue those investments. A 2021 Deloitte report reveals that 65 percent of financial services expect that they will increase their cloud technology adoption within three years. FIs are taking the cloud-first approach wherever possible amid the pressure to meet ever-increasing customer expectations. Customers demand higher-quality digital experiences customised to their needs. With the wealth of data, FIs must leverage solutions that facilitate hyper-personalisation to make customers feel they are understood. This raises consistency and trust, increasing customer satisfaction to boost retention. 

To optimise data and take full advantage of digitalisation, it is incumbent on banks in Southeast Asia to harness cloud-first solutions that integrate services like natural language processing, machine learning (ML) and AI-powered recommendations to create a seamless customer experience that is intuitive and organic. 

Artificial intelligence (AI) and ML are more than just buzzwords. A global report by Rackspace Technology found that most businesses in Asia are already beginning to reap the fruits of AI/ML through actionable insights from large and disparate datasets. Through AI and ML, significant business efficiencies are uncovered, and it is high time that traditional FIs harness these same technologies to make full use of their cloud deployments, data and analytic systems. 

Free Your Data By Being On The Front Foot

Cloud technology continues to accelerate digital innovation across financial institutions hugely as the sector continues to transform in the Asia Pacific. Fresh opportunities are emerging as organisations leverage data analytics to maintain competitiveness, boost efficiency and generate new revenue streams. Cloud expenditure is expected to grow to US$200 billion by 2024 across the Asia Pacific with a CAGR of 20 percent. 

While India still leads the region in overall IT expenditure and investment into public and private cloud services, challenges ranging from cybersecurity to data governance and the skills gap could trip up FIs in the near term.

The way to overcome these hurdles is to address out-of-date cloud backend and make the most insights and enhance decision-making.

Starting with mitigating performance issues, which can result in costly downtime, addressing these hurdles will allow data analytics platforms to be redesigned with a cloud-native architecture approach. A robust cloud platform can offer organisations secure and scalable bi-directional communication across its fleet of smart devices. This provides data and insights to end-users through organisations' applications. As a result, FIs not only gain security and compliance, but customer satisfaction too, ensuring return on investment.

Pivoting To Cloud-Native Approaches

With digital transformation, a business imperative, traditional players in financial services need solutions that ease their migration to the cloud while optimising the adoption of emerging technologies. Now more than ever, a bank's competitiveness hinges on allocating resources efficiently and keeping wastage to a minimum. By leveraging a cloud-native approach and expertise that offers flexible and tailored solutions, FIs can optimise their cloud environment to specifically meet their most critical business needs. This reduces costs and drives differentiation and go-to-market, which inevitably delights customers and drives growth.

The article has been written by Debajit Roy, Managing Director India, Rackspace Technology