Banks and financial services eyeing the cloud, SAP and Ovum research says

The cloud isn’t just reserved for startups and other tech businesses – banks and financial services companies are looking to tap into it, too.

That’s the conclusion of a survey released this week from SAP SE and research firm Ovum Ltd., which found cloud computing is actually in demand in the financial industry, despite past fears that the cloud isn’t as secure. Researchers polled about 400 IT decision-makers working in banks and insurance companies from around the world, including North America, Europe, Asia Pacific, the Middle East, and Latin America.

Out of those polled, 80 per cent said they agreed with the idea that software as a service (SaaS) helps organizations act more quickly on new opportunities, while another 79 per cent said they felt SaaS also helps new entrants move into the market more quickly.

Over the next year, 42 per cent of IT decision makers at banks said they expect to make more investments in the cloud, adding those investments should “increase significantly” over the next 18 months. IT decision makers working for insurers were less enthusiastic at 33 per cent saying they would be making those investments in the same period.

However, there are still some concerns over jumping into cloud technology. About 36 per cent of all respondents said they feel there are still some concerns about complying with regulations, and another 35 per cent said they weren’t completely sure the cloud was reliable. Thirty-one per cent said they also had concerns about integrating their existing systems with SaaS technology.

Even so, SaaS seems to be one of the most enticing options for banks and insurers, with 27 per cent said they prefer it above anything else. Another 42 per cent said they consider SaaS for every project they undertake.

“The findings reveal a new maturity for cloud computing in the financial services industry,” said Daniel Mayo, chief analyst of Ovum, in a statement.

“The cloud is now a growth driver for banks and insurers, rather than a medium just for bringing costs down. They are buying SaaS solutions to simply operations, develop better products and quickly enter new markets. The industry has made it clear that SaaS will radically change the banking and insurance landscape.”

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Candice So
Candice So
Candice is a graduate of Carleton University and has worked in several newsrooms as a freelance reporter and intern, including the Edmonton Journal, the Ottawa Citizen, the Globe and Mail, and the Windsor Star. Candice is a dog lover and a coffee drinker.

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