Banks use lots of cloud services but are unaware

A survey of US banks has revealed that banks underestimate the scale of cloud use on their networks on a massive scale

A survey of US banks has revealed they underestimate the scale of cloud use on their networks.

Research by Skyhigh Networks found that, in the US, an average of 844 cloud services are being used by bank employees on the corporate network.

Banks are built on large IT infrastructures that process substantial volumes of data on a daily basis. Cloud will enable banks to keep up with technology changes while reducing costs. But fears over data security and strict regulations mean banks have rules against employees using cloud services. But many are using services such as Gmail and Dropbox in their work.

The research of US banks from Skyhigh Networks also revealed a lack of knowledge of what is actually being used by workers at banks. 

According to website American Banker, Rajiv Gupta, CEO of cloud security supplier Skyhigh, said: "If you did a survey where you asked the financial services companies themselves how many cloud services they use, the answer would be somewhere between 32 and 34, because you approved those."

The availability of cloud-based apps that are often free to use is creating the shadow IT phenomenon, in which employees are using unapproved apps without the knowledge of the IT department.

Banks' IT departments are using cloud-computing services to support IT development and cut costs. These are usually hybrid models that combine private and public clouds.

Barclays, for example, has built a private-cloud infrastructure to support a raft of cloud-based mobile banking services.

The Pingit app, which allows people to pay for items and services through mobile phone numbers, was the first in a series of mobile developments that sit on  a “mobile money platform” in the private cloud.

The private cloud means that, rather than using a website that sits on top of core IT infrastructure to enable mobile payments, the Pingit app plugs directly into it.

Banks are also using the cloud to cut costs. Two European banks have outsourced  IT in the cloud with IBM, to create hybrid IT environments that will give them the capacity to deal with workloads created by data, mobile and social technologies.

Spanish bank Banco Popular and Boursorama, a subsidiary of French bank Société Générale, have both recently outsourced work to IBM for cloud projects.

Banco Popular contracted IBM for 10 years as part of an IT transformation project which includes managing a private cloud infrastructure. The deal is expected to save $200m over the term of the contract.

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