Companies in the financial sector are beginning to recognise the opportunities and benefits that come with switching to cloud-based platforms. Developing in the cloud makes it much easier to scale, be compliant and run an agile business, which both fintech start-ups and established banks can benefit from.
Almost a decade after cloud providers like Amazon, Google, and Microsoft first launched their services, the cloud has truly become mainstream.
For Peter Schleidt, Bank Director at Jyske Bank, keeping pace with technological developments is just as important as issuing loans. That is why Jyske Bank in 2019 took the leap and re-developed their entire online banking service on a cloud-based platform.
I think that we will have far more collaborations with fintech companies in the future. Because there are a lot of options available now that we are on a cloud-based platform,
Peter Schleidt, Bank Director at Jyske Bank
By replacing an ageing legacy platform with a cloud-based one, Jyske Bank can now to a greater extent collaborate with or purchase ready-made systems from third parties, which can quickly be integrated into the bank’s user interface. And that creates a wealth of new possibilities.
Born in the Cloud
Developing products and services in the cloud is hardly groundbreaking to the current generation of young fintech companies.
To us, developing in a cloud environment is the only sensible option, as it makes it much easier to direct infrastructure, incorporate more machines into the architecture, and setting up various frameworks,
Mikael Nilsson, CEO and founder of the payment institute November First.
However, the cloud is not only chosen because, as a tech startup, it eases scalability of its solutions as more users join. To November First, the cloud platform also provides a series of advantages in compliance and security.
“We save time because we can automate a range of procedures for compliance. This way we can show that we can run the required tests, monitoring, and alarms, be it daily, weekly, or monthly. Furthermore, it guarantees that when IT-accounting is processed, it is much easier to give the accountants access to the underlying material,” Nilsson says.
He elaborates that November First, using Microsoft’s cloud platform Azure, is capable of directly benchmarking the company’s platform to a range of regulatory frameworks. Then, suggestions are given on how the business’ adherence to compliance rules could be improved further.
“Afterwards we can more easily determine where to focus our energy, and where we get the most bang for our buck,” Nilsson says.
Jyske Bank Has Redeveloped the Netbank
With a unified financial sector moving to cloud-based platforms in various ways, the opportunity to develop quick and agile services in partnership with other companies has improved significantly – and this includes partners outside the sector. This benefits both the bank’s customers and the bank’s bottom line.
At the top of Schleidt’s wish list of fintechs that he would like to see integrated into Jyske Bank’s app is Mobilepay. The hope is that this will make customers at Jyske Bank even happier with the app, while Mobilepay will see even more use.
Another hope is to integrate voice control. The bank has, in a single week, built Google voice control into the app in a testing environment. The challenge is now to find out what customers would like a voice-controlled mobile bank to be capable of.
“A voice-controlled mobile bank should be able to tell you more than just your account balance. So what would make a voice-controlled bank stand out? We do not have the answer to that, and that is the only reason we have not yet launched this feature,” Schleidt says.
This highlights one of the challenges of the cloud as well: When everything is possible, how do you decide which direction to go in?