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New Compliance Normal Cloud Solutions for Financial Firm
[The New Compliance Normal] COVID-19 accelerated the migration of financial firms to the cloud This is the first in a series of blog posts dedicated to “the new compliance normal.” RegTech companies have joined the conversation to talk about how regulatory compliance regarding market abuse has shifted since the pandemic began. During the research for this post, it was apparent that many of the firms addressed the shift to cloud as a possible solution to the current challenges that the pandemic brought with it.
Banks have been slow to embrace cloud computing Banks have been slow to embrace change and to adopt new technology overall, some are arguably fully resistant to the idea of migrating financial services information and services into the cloud. But the new compliance normal is forcing a shift. Banks, called out for their resistance, cited “regulatory ambiguity” as the primary reason for their reluctance to embrace the cloud yet it is now regulatory compliance – spurred by a global pandemic – that is driving the adoption of cloud-based solutions.
The benefits of a cloud-based compliance solution Larger banks have offered data that suggest a cloud-based strategy affords them about a 25% savings on IT infrastructure costs. Collectively, that’s about $15 billion per year. However, mid-size and smaller banks may not be seeing the same cost advantages; some even suggesting that their costs are now higher. Despite the costs or cost-savings, cloud-computing is emerging as a compliance requirement. According to FIS, “Managed Services in the cloud are not just less costly but also more accessible even in adverse conditions. It has never been more apparent than on-premise compliance software brings along significant risks. The ability to conduct remote installations and upgrades is becoming a requirement.”
[The New Compliance Normal] COVID-19 accelerated the migration of financial firms to the cloud Competitive advantage is also conferred to the financial firms who have migrated to the cloud. In this era of COVID, both traditional and nontraditional competitors are innovating to deliver increasingly personalized service to clients. As such, banks need every competitive advantage they can get, particularly as margins are eroding and shareholders are expecting increasingly greater returns.
The future came quicker than expected COVID-19 has brought the future to the present. The new compliance normal has arrived. Alyne states, “Smooth future-orientated operations may be extremely challenged if the organisation continues to rely on on-premise software. There is no better time than now for institutions to adopt scalable, cloud-based solutions.� We couldn’t have stated that any better ourselves; the time to migrate to the cloud to meet the new compliance normal is now. Gain insights and knowledge at The New Compliance Normal Hub and contact us if your organization would like to contribute to the conversation.
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