November 24, 2022 Blog

Top 4 Reasons Why Cloud computing is a Key Priority for Financial Services in 2023

Cloud Computing is Key Priority for Financial Services

Though several sectors were opting for database migration services, many financial services businesses in the past were reluctant to move to the cloud due to the security and compliance challenges associated with it. Considering the nature of services provided by financial companies, risking either of these priorities could be harmful. This is why the financial businesses were hesitant to discard their legacy systems and data centers.

However, cloud computing has evolved a lot, and there is a significant improvement in the security of data stored within the cloud. Cloud service providers like Microsoft Azure offer built-in services to safeguard infrastructure, applications, and data. This provision by Azure is helping financial companies identify rapidly evolving threats early and respond quickly to them. As a result, the cloud adoption rate has increased substantially.

Apart from the reason that they can now guard their data compliantly and securely in the cloud, why would the companies in the financial industry want to move to the cloud? Or, why is the global finance cloud market growing exponentially? If you look at the data, the global financial sector cloud market reached a mark of $23.67 billion in 2020 and is expected to reach $90.11 billion by 2030, growing at a CAGR of 12.4% during the forecast period. To help you figure that out, here are the six most evident reasons why financial companies are leaving their legacy infrastructure behind.

1. Cost Reduction

The legacy infrastructure has a lot of issues related to it. First and foremost you need to invest heavily in expensive servers and supporting equipment along with other hardware. The idea is that is not a one-time expense. You need to keep investing in maintaining, upgrading, and repairing those servers, equipment, and hardware. 

2. Enterprise Synchronization

By integrating various business units through the unified platform it provides for sharing data among people and teams, cloud computing enables enterprise synchronization.  This synchronization translates into integrated and improved decision-making processes that, in turn, yield faster solutions to customer challenges and problems. Moreover, the cloud also accelerates collaboration and decision-making by unlocking more actionable and sophisticated analytics and insights through standard and connected data sets.

3. Scalability

The cloud offers an operation-based pricing mechanism. Through operation-based spending or the pay-as-you-go pricing model, financial institutions can scale the resources up or down and so scale the costs up or down based on the requirement. In the legacy infrastructure, however, they had to spend a fortune in buying the hardware to accommodate the increased traffic. The idea is the hardware installed to scale up the resources mostly goes unused in off-seasons or when the traffic is low.    

4. Improved Agility

By focusing on mobile productivity, the cloud makes operations more resilient and agile. Organizations are not required to tether their employees to their desks. The employees can access data and services virtually with a click of the mouse. This feature of the cloud makes it even more crucial for financial companies, especially post the Covid-19 pandemic when the entire world was forced to adopt the WFH culture.  

5. Improved Customer Experience

The cloud enables business innovation. Through it, financial companies can streamline operations and improve the quality of customer experiences. They can gain useful insights into customer behavior through advanced analytics capabilities and give their teams the relevant information required for personalizing offers, optimizing products, and improving customer satisfaction.

And! Of Course! The IT Security

The stringent security standards followed by most cloud providers may even surpass onsite security provisions. Even if the server crashes, with the cloud your data remains secure. The superior protection against data theft, viruses, malware, and data backup has now made financial organizations breathe easy.

The Final Thought

The financial services firms are adopting an end-to-end approach in migration to the cloud to reach their value goals. Cloud migration services have evolved dramatically to adjust to industry regulations and needs. By keeping the cloud as the focal point of the business transformation, financial companies are realizing its immense potential.

The best part is several cloud migration companies help you seamlessly and easily migrate to the cloud. They ensure that there are zero to minimal disruptions in business processes and that compliance is met while migrating to the cloud. Irrespective of whether you want to lift and shift your applications to the cloud without altering the codes, re-architect applications to optimize them for the cloud, or rebuild PaaS or SaaS services and architecture to enjoy new functionalities, cloud migration companies like LogicEra can help you do all that.