Competition rises in financial sector’s cloud computing
In today’s digital ecosystem, organisations that do not evolve fast enough will be less competitive as they face disruptions in their respective industry from new entrants and overseas providers and many instances by non-traditional banking services. Jarom Britton, Malaysia and SEA New Markets Microsoft corporate attorney
KUCHING: Financial services institutions ( FSIs) across the Asia Pacific region are under pressure to increase agility, improve efficiency, and embrace digital transformation, according to a Forrester Consulting study commissioned by Microsoft.
However, many organisations in the sector, especially in Malaysia, still lack a thorough understanding of how they can navigate regulatory and logistical processes, which slows cloud adoption and potentially puts these firms at a competitive disadvantage.
The study titled ‘Ensuring Agility and Trust in A Rapidly Changing Business Environment’, evaluates cloud adoption trends among FSIs in Asia Pacific and gauges their knowledge and perceptions of cloud-related financial regulations. It analyses the impact of regulatory compliance, security and privacy, and reliability concerns on current and future cloud initiatives.
As per the Forrester study, FSIs across Asia Pacific are increasingly embracing cloud computing – both public and hybrid – and must therefore understand cloudrelevant outsourcing regulations, formalise internal cloud policies, and implement best practices for engaging with cloud service providers and regulators.
In Malaysia, the FSI sector is slow to adopt cloud technologies and wary of embracing digital transformation. The study reveals there is a ‘wait and see’ attitude for most FSIs. Despite a strong interest in the technology, the pace of cloud adoption in Malaysia has been slowed by common miscon- ceptions that there are regulatory barriers on the use of public cloud services.
“In today’s digital ecosystem, organisations that do not evolve fast enough will be less competitive as they face disruptions in their respective industry from new entrants and overseas providers and many instances by non-traditional banking services.
“Having helped many FSIs move to the cloud, including several in Malaysia, Microsoft has the resources, experience and expertise to deliver solutions that meet the compliance requirements of the financial services sector.
“We are the trusted partners of FSIs as they adopt cloud in a way that meets the highest compliance, risk and security standards,” Microsoft’s corporate attorney for Malaysia and SEA New Markets Jarom Britton added.
One key finding from the study is that leading FSIs in the region are using regulations to help steer public cloud initiatives, and not as an excuse to stop them. The better a firm’s understanding of regulations, the more likely it is to embrace public cloud services.
In most instances, these initiatives are directly tied to customerfacing, digital banking capabilities like new customer acquisition and on-boarding.
“Today the behaviour towards implementing cloud and the related internal policies among FSIs in Asia Pacific are clearly maturing. Cloud is increasingly seen as an enabler of the organisation’s journey to digital transformation. However, it is important to realise that a cloud strategy will only be successful if there is a clear understanding of applicable regulations.
“As organisations’ understanding of regulations and of how and when to engage regulators increases, so too does their ability to successfully adopt competitive cloud solutions,” Forrester Research analyst Fred Giron said.
The study was conducted over a three-month period, and involved in- depth interviews with 34 senior IT decision-makers in the Asia Pacific financial services sector from nine countries: Australia, Hong Kong, Korea, Malaysia, New Zealand, Japan, Indonesia, Singapore and the Philippines.
Forrester found that these organisations are at vastly different levels of maturity in cloud understanding and adoption.