Storing core banking data in the cloud enables financial institutions to streamline their processes, improve efficiency and deliver a better user experience
Cloud banking enables faster and more agile responses to banking users by storing and analyzing massive amounts of data available on the Internet in real time.
This technology has proven to be superior in synchronizing banking operations and software and making them available under on-demand models, which offers multiple advantages to improve product offerings, efficiency, processing, and customers’ experience with their banks.
Most regulated banking institutions were born in the mainframe era and not in the cloud—public, private or hybrid. However, the digital era is advancing and creating challenges for traditional banks.
Cloud banking is the technology that allows massive analysis of data and the enhancement of the results in order to offer customized products and services according to the needs and objectives of each consumer.
The application requires the use of powerful hardware and the development of user-friendly software. In the case of hardware, a record of global movements and transactions are stored in servers that can be read by authorized personnel and customers in just a couple of clicks. The software, meanwhile, allows the data to be processed.
This translates into, for example, online credit approvals, the immediate modification of the criteria for issuing the loans, and their subsequent authorization on a globally available platform with high levels of security.
Cloud banking also provides services in a user-friendly interface that improves the user experience.
All this helps to achieve a faster, less costly implementation of financial services and products, and for a financial institution, speed is fundamental to its positioning in the market.
Cloud banking services enable financial firms to focus on improving customer experience and personalizing the financial solutions they offer. A speedier response, the construction of applications or websites preferred by customers, and a greater understanding of the user help to ensure a positive customer experience.
In short, the migration of financial services and products to cloud-banking platforms offers advantages that banks must implement urgently to avoid being left behind by the progress of fintechs, big techs and other technological players.
Proper data management and solid technological support can help banks improve their product offerings to customers. Indeed, developing or partnering with a cloud provider boosts companies' delivery times and also allows them to customize the tools they put in the hands of their users.
Cloud storage streamlines data access because servers are focused on delivering information and processing it quickly. Companies that offer cloud banking platforms guarantee the bank an efficient registration and storage of users' journeys.
In fact, leading banks such as BBVA recognize that the adoption of this technology allows them to multiply data processing and reduce the cost of information storage.
The adaptability of cloud banking enables easy interoperability between companies. Banks that develop their processes on this platform can open and share their services and products—according to their commercial agreements—in order to participate in the dynamics of open finance and embedded finance. In fact, putting financial products in the cloud facilitates and promotes opportunities for banks to offer their financial services to third parties.
These four advantages of migrating core banking to the cloud have a positive impact on the bank's internal operations and on the products they offer to the customer. Therefore, implementing a fully cloud-based system is one of the goals that leading banks seek to achieve in their digital transformation processes.
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