The new generation of core applications is a popular topic in the market, yet few banks have adopted them. But to ensure survival, traditional banks need to adapt, by replacing legacy systems that aren’t fit for purpose in modern times. Here is where the cloud can be a game-changer.
Customer demands have changed over the last decade, with more compliance requirements dominating the agendas of banks and other financial entities. Customers expect the same intuitive and intelligent user experience(UX) from banks, as they get from other digital leaders. This only puts more pressure on how banks reshape their core banking architecture.
Now a new generation of modern core banking technology providers is surfacing. With the adoption of cloud-native systems, banks can now move away from tiresome upgrade cycles and integration burdens. But some things are often overlooked:
1. Digital skills gap.
One aspect that causes concern with the cloud migration, is that executing the process can result in downtime - due to the ''digital skills gap''. This term refers to the gap between software capabilities and employees’ skill levels.
This gap is a serious problem for many organizations, as it can stop the adoption of cloud technology. Read this article to learn more about the digital skills gap and how to avoid it.
2. Data Migration
Data migration can be a burden when it comes to cloud adoption. The process involves taking records from different sources and in different formats. Some of the main challenges are data loss risk and substantial time and human resources.
To ensure a smooth migration process, it is necessary to have an adequate strategy with a clear roadmap, goals, and directions - as a bank, you should be aware of your challenges and what your end goal is. This will minimize risks during data migration and maximize optimal utilization of the new software. It pays to involve a partner with extensive experience in data migration projects.
3. Data Security
Data security often is an argument to postpone moving to the cloud. There is a misconception about the security level of cloud solutions. An on-premise environment feels easier to monitor when it comes to system breaches. However, when it comes to security within the cloud there are three things to consider
Adjusting a cloud environment to limit security vulnerabilities can happen much more often. Once a leak has been found, you can instantly start closing it. This as opposed to on-premise solutions that often require months to update
Cloud solutions have a wide customer base. Every security improvement is instantly implemented for all SaaS clients. This means that even without experiencing a security breach, your security level is updated.
A proper cloud-based architecture enables you to unlock your data in a more advanced way. This means that security breaches are more easily noticed, enabling you to act and instantly limit the damage done by any digital trespassers. Watch the expert seminar by our security specialist Frank Min to learn more about how you can limit the damage of trespassers.
Pay attention to these three elements to ensure a smoothly implemented core banking transition to the cloud. This will enable you to reap its benefits, meet new customer demands, and create brand new business opportunities.