This article was originally published in the Autumn 2018 issue of The Record.
Since the first modern cloud computing platforms went live in the early 2000s, the adoption of cloud infrastructure as a vehicle for the delivery and consumption of software has continued to accelerate. According to Gartner, adoption rates are growing by 21% annually, while Deloitte Global predicts that by 2021, over half of all information technology spend will be cloud-based.
Despite initial scepticism, the financial services community has also learned to embrace the cloud. According to a recent survey of bank executives by Finextra Research, nearly 90% of banks are in favour of including software-as-a-service or cloud-based services as part of their infrastructure. Today, it is the norm for financial institutions to run customer relationship management, enterprise resource planning and treasury applications, which store sensitive customer and bank data, in the cloud. In banking, as in other industries, the notion of ‘shipping and installing’ software is now a thing of the past.
One area of banking however, remains glaringly behind: core payments processing. Specifically, the management, processing and clearing of wire or real-time gross settlement transfers, automated clearing house, cross-border and immediate payments is still primarily performed using on-premise software. As open banking, immediate payments, artificial intelligence, blockchain and other initiatives continue to be top of mind, financial institutions will need to adapt quickly to stay relevant in the fast-changing payments space.
Finastra, in partnership with Microsoft, is making great strides to buck the status quo by providing our payments solutions on Microsoft Azure. Moving payments to the cloud provides multiple benefits, including faster access to new technologies and innovations, and streamlined onboarding, which both reduce upgrade cost and effort. Our clients can rest assured that Finastra’s payment solutions provide comparable depth of capability and functionality to on-premise alternatives, with the highest levels of reliability and security. In fact, Microsoft spends over US$1 billion on cybersecurity alone to stay ahead of the curve on security threats – far more than any individual financial institution can – and ensures compliance with a wide range of international and industry-specific standards.
This collaboration has fundamentally changed how Finastra delivers payments software to our customers and partners, allowing us to bring the benefits to banks and financial institutions worldwide.
Mihail Duta is head of Product Management, Americas Payment Solutions at Finastra
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