There is a huge transformation taking place in financial institutions. The banking habits of customers are changing and they are becoming more confident with all things digital which give room for new banking business models. Digitalization is also accelerating the growing number of competitive offerings from fintechs, big techs and other third parties. This article will look into cloud banking as a new banking business model and how ARYZE will harness its power to unleash opportunities and take open banking to a new level.
How are cloud and open banking intertwined?
In order to provide a real bespoke customer experience, open banking relies on data and the capacity to process large volumes of it in real-time. Cloud solution offers true processing capacity to take in alterations, encapsulating a vast volume of customer data, analyse it, and deliver tailored services to customers. Cloud solutions help banks with scaling and real-time processing, gaining customer insight and deliver bespoke services in context, safe and secure processing, move to microservices and continuous development.
ARYZE takes open banking to the next level
Traditional banking mainframes are being challenged by technologies such as cloud banking. There are three central points that benefit from having a cloud-based core banking system over a traditional one. ARYZE will bridge the gap between legacy and next-generation financial networks and take Open-Banking to a whole new level.
System resources: can be scaled up and down rapidly to meet the demands of the bank as and when required, rather than needing to invest in system capacities that are only utilised during a few peaks periods.
Reduced costs: cloud computing requires less up-front expenditure in infrastructure costs, saving banks from having to maintain their own data centres. These systems can also be deployed faster than traditional ones.
Flexibility: there is a focus on modularity and offering different functions rather than being integrated as part of a single piece of software.
Source: Banking and payment infrastructure
Modernizing banking platforms
Modernized banking platforms should be: distributed at the edge, interconnected to ecosystems, agile and elastic in contrast with legacy payments infrastructure. When it comes to modernizing banking platforms, having the right cloud strategy is essential (private, public or hybrid), as well as having infrastructure proximity to cloud providers and strategic partners is a critical consideration.
IaaS, PaaS and SaaS (Infrastructure as a service, platform as a service and software as a service) are different types of cloud banking and they are not mutually exclusive. According to our partners at IBM, many mid-sized businesses use more than one, and most large enterprises use all three.
Conclusion
Digital transformation is here to stay and the future of banking and payments must be instant, open and borderless. Legacy systems heavily burden banks having been built on outdated architecture and these burdens impact customer satisfaction and hinder the opportunity for banks to attract new customers and retain existing ones. In order to improve retention, banks that cannot fully modernize their infrastructures, can still focus on the customer experience and tap into the benefits of cloud technology.
Cloud technology and open banking are just elements that can allow banks to build the future of banking. ARYZE is building a full-reserve digital bank using cloud-native banking interlinked with the world of blockchain, providing a seamless customer experience that is globally scalable and interoperable. Moreover, ARYZE is bridging the world of regulated money with open-source platforms to secure liquidity that businesses and financial services providers can use to make their systems more efficient, integrate with, and build upon. ARYZE´s modular cloud-based solution is based on microservices providing compatibility with a variety of external and internal services through APIs in the MAMA app.
Finally, for banks to stay afloat and survive the so-called 4th industrial revolution of new emerging products and constant trends, they must re-imagine how they serve customers and get on the road of digital transformation and innovation. Also, they should engage in collaborations with fintechs that can provide the adequate influx of innovation that is required for a successful transformation that truly benefits the customer.
