First of all, what is the financial services industry?
The financial services industry has quite a broad spectrum. It includes corporate financing, fintech, loans, mergers and acquisitions and private equity, payments, and savings and debt. Did you know that the estimated 2021 revenue of the financial services industry was $4.85 trillion, according to research carried out by Zippia?
As the financial services industry is embracing the evolution of technology with open arms, banks and fintech organizations are innovating continuously to not only bring the best experience to the customers but also to stay ahead of the competition. From moving towards online banking to mobile payments and chat bots, this industry is doing it all.
Now, imagine fintech companies and banks incorporating cloud into their operations. Cloud is basically a network of servers where data is stored and all you need is an internet connection to access it. The cloud market is turning out to be huge. According to Cloudwards.net’s research, the global cloud computing market was valued at $371.4 billion in 2020, and is estimated to rise to $832.1 billion by 2025.
Cloud has become central to digital innovation and while most companies are moving their infrastructure or including cloud into their functionalities, the financial sector had been wary of this trend due to security concerns. However, post pandemic, even the financial services organizations and banks are willing to take the leap of faith and include fintech solutions and cloud into their workflow.
Let’s look at 4 business benefits that fintech companies and banks can derive from cloud technology:
Saving on costs: Just think of the time and money banks and financial services companies will save by moving at least part of their infrastructure to cloud. They can save on all the costs they incur while investing in data centers and training of staff for the same. With cloud, banks and fintech companies would not have to spend heavily on software and hardware and can instead move the infrastructure to a secure cloud service provider.
Scalability and flexibility: Ultimately, cloud is one of the best ways to scale your business. Most of the companies adopting cloud aim for speedy scalability. With infrastructure on cloud, it will be easy for the banks and fintech organizations to build new services and applications to improve customer experience as it provides agility. This in turn will help them scale their businesses at a faster rate.
Increased efficiency: Financial services organizations operate across various markets and need to acquire and manage data on a large scale to maintain efficiency. With cloud tech, companies can acquire and store large quantities of data securely and make it accessible easily. While the major concern for these organizations is security, zero-trust verification and encrypted data have increased cloud security now.
Improved customer experience: The final goal of any bank or financial services company is to offer the best customer experience with this sector also become consumer-centric. With cloud native application development, banks and fintech companies can develop and deploy apps and other services faster to keep the customers engaged. The banks and companies can also offer more personalized experience for the consumers and give them more control over their finances.
According to an article in Forbes, the fintech industry is not shying away from capitalizing on the benefits of the cloud and helping in driving the industry’s forecasted 23.84% compound annual growth rate. We have come quite far on the technological route and there is no turning back from here. As companies are willing to experiment and innovate, this is the right time to opt include cloud across markets including the financial services market.
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