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Financial services firms look to the cloud

Financial services firms look to the cloud

Despite compliance and legal constraints, cloud seen as key to business strategy

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The majority of UK financial services firms believe the cloud is a key enabler for their business strategies, despite the constraints that come with meeting with compliance requirements.

Fujitsu commissioned research firm Coleman Parkes to conduct interviews with 50 CIOs across the UK wholesale, investment and retail banking markets.

Fujitsu found that cloud computing was now high on the CIO agenda, with 60 percent of banks believing that it will help them achieve their business strategies.

In addition 64 percent believed that cloud computing was a key enabler of change within their organisation. A significant number of respondents plan on deploying cloud-based solutions to drive efficiency within core functions, particularly in retail banking functions such as loan processing (77 percent), credit card processing (70 percent) and mortgage processing (64 percent).

The enthusiasm for cloud-based solutions in the financial services sector comes despite wider concerns in the corporate world about where customer data would be stored by cloud providers, and whether it would be accessible by third parties.

For instance, the US Patriot Act makes it possible for the US government to force US companies to hand over their customer data, even if those customers are based in another country. A large proportion of cloud providers are US-owned, and this type of legislation is contradicts data compliance laws over customer data in Europe.

Investment was also seen as critical by financial firms, with 65 percent of CIOs saying that in order to transition the IT department to truly meet changing business needs, extra budget would be required

The Fujitsu research showed that mobile will be an increasingly important channel for British financial institutions over the next three years too, with 49 percent of organisations stating that mobile banking is important to customers today, while 71 percent predict it will be by 2015.

“The reputational crisis that the financial services industry has been through has tested customer loyalty”, said Anthony Duffy, director of retail banking at Fujitsu UK and Ireland. He said, "The financial services industry has faced some tough challenges recently and will continue to do so for a few years at least. Banks need to adapt, change and seek new revenue streams in order to thrive and succeed."

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