Creating new business frontiers for financial organizations with cloud technology

Although it seems like it has only just arrived, cloud technology actually goes back a quarter of a century, and by 2002 cloud servers were offered to developers with many commercial companies starting to employ the technology. Banks and financial services companies were, however, less ready to embrace this technology. There were issues of security, of cost, of control – all of which have since been overcome, but which slowed adoption.

In spite of the many advantages of cloud, these problems had to be overcome and regulators were justifiably cautious. Today however, banks and financial services companies are rapidly adopting cloud technologies to improve customer engagement and leverage data to maximum effect.

Simply using the technology is not the same as embracing it, and banks and financial services companies often need to look at new strategies to help them prepare for the future with changing consumer expectations, emerging technologies, and alternative business models. As Conway’s Law states: “Any organization that designs a system will produce a design whose structure is a copy of the organization’s communication structure.” The pitfalls are varied – and can be expensive.

As institutions move to an Application-Centric model, placing Cloud-Native architecture at the center of their offerings, the cloud allows the creation of new business offerings and better customer experience. This is both a necessary and desirable move, since the customer profile has changed, with acquisition and retention of customers requiring mobile acquisition, intelligent marketing, mobile payment, open banking and banking-as-a-service functions integrated into an all-scenario finance suite.

For the bank or financial services company, improved insights and stronger risk controls, including anti-fraud and anti-money laundering are new requirements that would be difficult to attain with a more ‘traditional’ resource-centric model. Traditional models, might give a sense of ‘control’ but actually contain limiting factors because they deny the ability to rapidly innovate or adopt new technologies (such as big data, AI and blockchain).

Cloud also provides operations with the ability to be agile and resilient, coping with service uncertainties, speeding up service delivery, and improving competitiveness with a system that can easily be scaled up, added to, grown or replaced.

The removal of these limitations allow the personnel of the bank or financial services company to focus on the job of creating innovative business models and on delivering business value for their customers.

In taking these steps, whether just starting the journey or as a cloud-native adopter, companies need a partner that they can rely on to deliver the products and services, along with strategic knowledge, to ensure that the systems match their needs.

Organizations need input and guidance from professionals who come from a culture of cloud technology rather than older practices. As there are no proven methods or tools to guide the development of the cloud strategy and plan, it is necessary to choose a partner which has experience and understanding of creating a new infrastructure built around the cloud.

As an example of this breadth of Huawei’s expertise, our financial inclusion solutions have already been successfully implemented in more than twenty countries.

Huawei worked with KBZ Bank in Myanmar — the largest local bank — to build a new digital wallet called KBZPay based on the public cloud. KBZPay integrates various marketing tools to deliver a fully digital experience to users and help merchants attract customers. In just two and a half years, KBZPay on-boarded over eight million registered users, making it the leading digital payment brand in the country.

Myanmar

In Kenya, Huawei cooperated with Safaricom — the largest local carrier — to build the payment brand M-Pesa. Not only does the platform support bank transfers, it also offers several services for daily life. At the same time, it helps KCB Bank, NCBA Bank, and Safaricom provide micro and small loans to individuals and merchants. On the market for 14 years, M-Pesa has significantly contributed to increasing financial inclusion in Kenya from 23 per cent to 85 per cent.

Kenya

Huawei strives to deliver convenient and diverse financial services to everyone. Using its advanced connectivity and platforms, Huawei helps financial institutions build digital business processes, implement digital financial inclusion services, and achieve sustainable financial development.

HUAWEI CLOUD is deployed globally, serving over 300 financial customers across Asia Pacific, Latin America, Europe, Middle East and Southern Africa.

For more information on Huawei’s cloud offerings for the financial industry, visit the website.

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