Technology

What Types of Cloud Services do Financial Institutions need?

The Cloud has been taking over these past few years. In reality, Cloud technology has shaped many of the products and services we take for granted for more than a decade now. But businesses are just now beginning to migrate en-mass to the Cloud, especially in the past two years, since the onset of Covid-19.

One of the industries that can really benefit from Cloud technology is the Financial Services sector. To get an idea on how, we spoke to an IT support and managed service provider based in London, called TechQuarters. The IT support Financial Services organisations get from TechQuarters has always been Cloud-based; but there are other ways that they can adopt Cloud solutions, in a more direct way.

So, what kinds of Cloud Services can financial institutions adopt?

1. Payment Processing Services

Payment processing is a significant operation for financial firms. A lot of banks – especially the larger ones – prefer to process payments in-house, for security reasons. However, Cloud-based processing systems are now just as secure as internal processing. Even the leading payment networks – such as Visa or MasterCard – are now Cloud-based; and there are many other third-party payment processors available. 

There are benefits to using a cloud-based payment processor. For starters, centralising payment processing in the cloud could potentially offer cost savings; the central nature also makes it easier to collect data for analytics, which is a valuable resource in today’s business world.

2. Customer Relationship Management

No matter how big a company is, they are reliant on effective marketing in order to be successful. In fact, a lot of financial institutions – such as banks and creditors – tend to struggle with marketing. Financial companies often have a lot of different products and services they can offer, but segmenting their markets and targeting those products to the right audiences can often be quite tricky.

This is precisely what Customer Relationship Management (or CRM) is built for. It helps businesses collect and centralise customer and audience data, and gives them granular analytics tools to gain insights into their target markets. CRM is great at facilitating closer collaboration between marketing, sales, and customer service departments in a organisation – as these are the departments responsible for defining and optimizing the customer lifecycle, it makes sense for them to be working in harmony with the best tools available.

3. Core Banking Services

While it is very common for larger financial institutions to manage their own core banking, small and medium sized financial firms might struggle to do that themselves. For these smaller firms, the ideal solution might be to partner with a cloud solution provider that can offer them a full-stack banking system that offers full functioning from the front-end, all the way to the back-end – including everything from the teller line, to electronic bill payments, online banking, and all of the other core banking processes.

There are a number of well known cloud service providers that specialise in offering cloud-based core banking solutions. These companies include Jack Henry & Associates, and Fiserv.

4.  Infrastructure as a Service

One of the biggest ways in which the Cloud has shaken up the business world is by offering more cost effective and efficient solutions for storing company data and managing workloads. The bigger a company is, the more workloads and critical processes they have, and the more data they will accrue. This means more servers, more storage arrays, and more datacentres.

But with Infrastructure as a Service, businesses can do away with physical servers and on-premise infrastructures, and move all of their workflows to the cloud. In these centralised, scalable environments, businesses can get much better value for money in terms of compute resources and storage. It also allows businesses to test updates and even develop and deploy custom solutions, all form the cloud.

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