Investment in the cloud is expected to grow at more than six times the rate of general IT spending in 2020, with 90% of banks using the cloud in decade, according to a new report by Digital Solutions firm, Exception.
Headquartered in Edinburgh, it reveals the UK banking and financial services sector will accelerate its transformation to take advantage of today’s digital driven world. Traditional banks and financial service businesses, it says, are often hindered by legacy platforms, making it challenging to deliver the seamless digital experience demanded by customers.
Even greater agility in the financial sector
Scott McGlinchey, CEO, says: “The integration of new and legacy systems is one of the real issues facing financial organisations. Financial firms can adopt modern cloud integration to provide a much more agile and smarter approach to support the transformation of core banking systems.”
Many financial firms invest up to 9.4% of their operating income on technology, with 73% invested on maintaining their legacy systems, with some still operating “seven different payment systems and 20 custom-built applications.”
IT operational costs can be reduced by as much as 50%
Outdated technologies in the financial sector can equate to £162 billion invested globally. Exception believes that financial service businesses can reduce their IT operational costs significantly over the next 10 years, by as much as 50%, by moving their data and applications to cloud-based platforms.
Cloud technology adoption is one of the most cost-effective approaches, using flexible and modern solutions. The recently-published Cloud Integration Whitepaper highlights the problems of existing legacy systems. The document is one of the first to examine in detail the challenges of integration in today’s fast-moving digital environment, exploring how cloud-based Integration as a Service can deliver agility and speed of service.
Scott McGlinchey adds: “It is vital for the financial sector to transform digitally and many are well on their way. Otherwise, it is harder to innovate and compete effectively in the modern, digital-driven world we now live in.”
“This new world creates significant pressures for companies, which includes the need to integrate new fintech solutions and possess an agile capability to gain competitive advantage over rival brands. There is so much going on. Pace and execution are key advantages. We want to highlight integration on cloud platforms which may ease some of these burdens.”