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Some of the continent’s biggest banks are joining forces as founding members of the European Cloud User Coalition (ECUC) to accelerate the adoption of off-premise services in the financial services industry.
A dozen financial institutions from across Europe have already signed up to the ECUC, including the likes of Allied Irish Banks, ING Group, Deutsche Börse, Euroclear, and UniCredit, to name a few.
The group have set their set their sights on establishing a series of security standards and best practices pertaining to the use of public cloud technologies specifically by the European financial services community.
Given its reputation for being one of the most highly regulated industries in the world, the financial services market has cautiously moved to adopt cloud technologies over the course of the past decade, but progress has markedly stepped up in recent years.
This is on the back of regulators in various European countries giving financial services firms the green light to proceed with using cloud technologies. On this point, the publication of the Financial Conduct Authority’s cloud guidance in 2016 is largely credited as having an acceleratory effect on the pace of digital transformation by UK financial institutions.
As acknowledged by the ECUC, the use of private cloud technology is prevalent in the financial services industry, but firms are similarly keen to ramp up their use of public cloud due to the flexibility, scalability and resiliency benefits it can offer.
Therefore its work will also focus initially on getting other European financial institutions to join its ranks, and the Coalition plans to publish a paper in due course looking at the challenges these firms face when trying to make use of public cloud services.
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- The financial services community has gone from being one of the least likely sectors to adopt cloud to becoming one of its keenest users, as regulator attitudes to using the technology have become more accommodating.
- US bank Goldman Sachs is considering converting its cloud investments into a non-financial services product line by creating a cloud-based core technology platform that could be sold as a service to other financial services companies.
The Coalition further claims that this work will benefit the industry in the long-term by enabling its members to be “more independent” when choosing which technology providers to work with, and – in turn – encourage competition.
Kerem Tomak, chief analytics officer and initiative lead at ECUC founding member ING, said joining the coalition looks set to pave the way for it to adopt a hybrid cloud setup that could transform the way its organisation operates.
“This coalition enables ING to adopt a hybrid cloud setup for analytics and artificial intelligence that brings us up to par with the fintechs and bigtechs of this world,” said Tomak. “It allows us to improve our digital capabilities and offer customers better, faster and more personalised experiences.”
“Key components for making cloud technology work for banks are security, data privacy (GDPR) and EU guidelines from regulatory bodies like the European Banking Authority and the European Banking Federation. Data sovereignty and cybersecurity requirements are important aspects that need to be addressed.”