DZone
Thanks for visiting DZone today,
Edit Profile
  • Manage Email Subscriptions
  • How to Post to DZone
  • Article Submission Guidelines
Sign Out View Profile
  • Post an Article
  • Manage My Drafts
Over 2 million developers have joined DZone.
Log In / Join
Refcards Trend Reports Events Over 2 million developers have joined DZone. Join Today! Thanks for visiting DZone today,
Edit Profile Manage Email Subscriptions Moderation Admin Console How to Post to DZone Article Submission Guidelines
View Profile
Sign Out
Refcards
Trend Reports
Events
Zones
Culture and Methodologies Agile Career Development Methodologies Team Management
Data Engineering AI/ML Big Data Data Databases IoT
Software Design and Architecture Cloud Architecture Containers Integration Microservices Performance Security
Coding Frameworks Java JavaScript Languages Tools
Testing, Deployment, and Maintenance Deployment DevOps and CI/CD Maintenance Monitoring and Observability Testing, Tools, and Frameworks
Culture and Methodologies
Agile Career Development Methodologies Team Management
Data Engineering
AI/ML Big Data Data Databases IoT
Software Design and Architecture
Cloud Architecture Containers Integration Microservices Performance Security
Coding
Frameworks Java JavaScript Languages Tools
Testing, Deployment, and Maintenance
Deployment DevOps and CI/CD Maintenance Monitoring and Observability Testing, Tools, and Frameworks
  1. DZone
  2. Software Design and Architecture
  3. Cloud Architecture
  4. Why Banks Are Moving to the Cloud (and Why You Should, Too)

Why Banks Are Moving to the Cloud (and Why You Should, Too)

The cloud offers a variety of benefits that banks, and all businesses, can relate to. From cutting costs to agility to security, teams should look closely at the cloud.

Jim Crowley user avatar by
Jim Crowley
·
Jan. 20, 17 · Opinion
Like (2)
Save
Tweet
Share
6.22K Views

Join the DZone community and get the full member experience.

Join For Free

A major shift is taking place in banking right now. It’s a shift many banks have been pretty hush-hush about until now, and that naysayers said would never happen.

Banks are rapidly testing and moving to the cloud.

What happened in the past two years that changed how the banking industry approaches the cloud? Two words: Capital One. In October 2015, Capital One’s CIO, Rob Alexander, revealed that the bank was all-in on AWS. They were one of the very first U.S. banks to not only commit to the cloud in a big way, but also to announce it loudly and proudly.

Around the same time, World Bank, made a bold move. With Stephanie von Friedeberg, World Bank’s CIO, at the helm, the company quickly shifted from risk-averse, anti-cloud to pro-cloud and the company quickly shifted.

The cloud has since transformed from a frowned-upon technology in the banking sector because of security and regulatory concerns to an area of growth and opportunity. While many banks today are still leery of the cloud, many more are starting to see the cloud as the future of banking.

Here’s why.

1. Cost Cutting

When von Friedeberg made her case for the cloud at World Bank, one of her points was how much they could reduce their cost footprint. In fact, by migrating from Lotus Notes to Microsoft 365 for email, they experienced a cost reduction of $7 to 8 million, as well as a reduction in the amount of IT staff time needed to manage it.

Capital One is also benefitting from cost reductions enabled by the cloud. The company went from managing and paying for eight data centers to 2014 to a planned three by 2018.

Cost savings, coupled with the rapid improvements the cloud can bring to an organization, means IT organizations within banks are quickly shifting from being seen as a cost center to an innovation center.

And because cloud applications are accessible from any location, organizations like World Bank find that their employees are now more productive. A connected workforce means employers get more for their investment in each employee.

2. Rapid Deployment and Innovation

Banking is a crowded and highly competitive industry. And with customers more connected and demanding than ever, banks have to continuously innovate to keep customers engaged. Many have responded with mobile apps, gamified experiences, and streamlined online user interfaces.

On premise, however, to build a new or improved application, a team would have to present a spec to IT, IT would have to allocate expensive hardware resources, and then the wheels would slowly start to turn. Twelve to 18 months later, a prototype would be available to test, and chances are it would already be obsolete compared with the latest cloud-based applications.

But in the cloud, developers can spin up a server in a matter of minutes and get an app ready for testing in a matter of weeks. This allows banks like Capital One to create new and better applications far faster than their competitors who are still using on-premise development practices. Today, Capital One is considered a cloud-first bank, and that’s very appealing to customers who value speed, innovation, and accessibility.

3. The Cloud Is as Secure as On-Premise

The fact is, the cloud is no less secure than on-premise infrastructure. It’s simply a matter of leveraging the right tools — those built for the cloud.

But what companies have tried to do instead is apply their on-premise security tools — the ones they’ve heavily invested in and become comfortable with — to their new cloud environments. Since these tools aren’t built for the cloud, they simply can’t catch everything.

Unlike in an on-premise world where there is a defined perimeter to protect, in the cloud, there is no perimeter. That means the threat landscape becomes unbounded, so the best way to add security is by leveraging continuous security monitoring. With continuous monitoring, no anomalous behavior goes unnoticed, giving banks the same level of visibility and protection (if not more) as they had on premise.

Cloud

Published at DZone with permission of Jim Crowley, DZone MVB. See the original article here.

Opinions expressed by DZone contributors are their own.

Popular on DZone

  • Secrets Management
  • Streamlining Your Workflow With the Jenkins HTTP Request Plugin: A Guide to Replacing CURL in Scripts
  • Memory Debugging: A Deep Level of Insight
  • PostgreSQL: Bulk Loading Data With Node.js and Sequelize

Comments

Partner Resources

X

ABOUT US

  • About DZone
  • Send feedback
  • Careers
  • Sitemap

ADVERTISE

  • Advertise with DZone

CONTRIBUTE ON DZONE

  • Article Submission Guidelines
  • Become a Contributor
  • Visit the Writers' Zone

LEGAL

  • Terms of Service
  • Privacy Policy

CONTACT US

  • 600 Park Offices Drive
  • Suite 300
  • Durham, NC 27709
  • support@dzone.com
  • +1 (919) 678-0300

Let's be friends: