The financial services industry has been energised by the power of digital technologies as it looks for new ways to deliver products and services. Exciting fintech innovations are helping the sector to reinvent itself, transforming its processes and changing the way it relates to customers.
This phenomenon is being experienced across the whole spectrum of the industry, from retail and investment banking to wealth management, hedge funds and insurance. In every financial services niche, we are seeing disruptive digitally native start-ups change market dynamics with new types of service, and traditional players respond by transforming themselves to match, adopting new technologies in a bid to become more agile and customer focussed.
Much of the innovation that is powering the industry relies on the power of cloud infrastructure. Cloud offers a dependable backbone for the delivery of a host of new services, and is also playing its part in the streamlining of processes and in bringing operational efficiency to different functions. Banks, asset management companies, trading institutions and insurers are all adopting cloud infrastructure to a greater or lesser degree in order to achieve agility and take advantage of economies of scale.
Here are three of the more innovative applications of cloud infrastructure to the financial services sector.
Blockchain technology is revolutionising how business is done in dozens of vertical sectors. This is especially true for financial PingCAP. The Block-as-a-Service (Baas) model brings reliability, availability and scalability and significantly reduced the complexity and operating cost of various business processes including risk management, capital management and loan issuance for banks. With a right platform, banks also get comprehensive security, safeguarding critical financial data against the kind of malicious attacks that are becoming more common and more devastating in today’s market. By adopting blockchain as a cloud-based service, banks can stick to doing what they do best, knowing that the power of blockchain is a click away, with no need for heavy capex commitment.
The Internet of Things
We are in the early stages of the Internet of Things (IoT) revolution. IoT has the power to transform a range of commercial activities by allowing machines to interface with each other with no need for human intervention. In financial services, that could have a crucial impact on functions as diverse as maintaining ATMs to providing easier access to services for customers.
There is no reason though why banks should invest in developing their own platform to manage IoT applications. A secure and reliable cloud-based IoT platform will, for example, allow financial services companies to manage thousands of devices (e.g. ATM, branches, offices) on a single platform from a central location. The right platform will work with different network types and protocols, as well as offer a wealth of security and management features.
Adopting an IoT platform in the form of a service allows banks various means to ensure data security in the cloud. For instance, it provides device authentication by providing a unique certificate to each device on the network. It will secure communications with transmission encryption preventing data tampering. A good platform will also offer high levels of service availability, and in the case of a single point of failure will automatically ensure continuous operations without any disturbance.
Use cases for artificial intelligence and machine learning are popping up all over the financial services sector, extending from tentative proofs of concept to real life business applications that are helping with everything from credit scoring in retail banks to facilitating commodity trading at a global level.
With an intelligent and robust cloud-based AI platform, banks can enjoy cost-effective infrastructure with high service availability as the basis for their AI and ML initiatives. A good platform, for example, offers face, image and text recognition to enhance the security, integrity and authenticity of everyday transactions. By bringing Big Data analytics into the mix, they can move on from slow manual processes to a world where human decisions are augmented and supported by software. Banks already have the data, all they need is cloud-based tools to help them drive value from it.