19, Oct 2023
Fintech’s Cloud Computing Frontier: Scaling, Securing, and Innovating
Financial services organizations can now access, store, and analyze data more securely and effectively than ever due to cloud computing. This has provided an ideal foundation for fintech companies to create game-changing products, services, and technology that have altered the financial environment.
By 2025’s end, the total value of the worldwide fintech market is forecast to reach $124.3 billion, expanding at a CAGR of 23.84% throughout that period. The financial technology industry increasingly relies on cloud computing services to meet the needs of its customers in the commercial and consumer sectors.
Why, therefore, do FinTech companies need to use cloud computing? Let’s see the impact of cloud computing on organizations and consumers in the fintech sector.
Role of Cloud Computing in Fintech
The advent of cloud computing in financial technology has dramatically expanded the industry’s potential and altered the financial sector’s requirements. LogicMonitor Research shows that by 2025, 87% of businesses will have accelerated cloud migration.
Cloud computing has made fintech more widely available, safer, and adaptable to different users’ specific requirements. Fintech cloud computing is expanding steadily, although cloud applications are still in their early days. Furthermore, 22% of fintech apps are currently cloud-based. However, this creates ample space for development and innovation.
Importance of Cloud Computing in Fintech
Financial data is increasing at an exponential rate. With the help of cloud computing, FinTech companies can safely and reliably handle and retain customer data. In addition, it lets companies use cutting-edge approaches to banking, money transfers, and fraud detection.
According to Statista’s global data report, in 2021 alone, more than 79 zettabytes of data were created, but only 10% was original, with the remaining 90% being replicated. Cloud-based solutions are essential because of the massive amount of data in a fintech business. By 2025, we will have created more than twice as much data, according to Statista’s forecasts (181 zettabytes).
The complexity of data, the volume of data being handled, and end users’ expectations have all made data integration an absolute must. The only way to keep up with the expanding computing demands of a dynamic business while guaranteeing unrivalled dependability and giving it a competitive edge is to use the cloud.
The Role of Cloud Computing in Modern Lending
In the current commercial lending sector, cloud-based solutions replace manual procedures with cloud automation predicated on speed, scalability, and ease of use for loan origination and administration needs.
With banks showing a greater willingness to lend to consumers, now is the time to accelerate digital transformation and meet the needs of the next generation of enterprises on the cloud. Let’s examine the benefits of cloud computing for lenders and companies alike.
Scalability and agility
The capacity to expand operations as needed is a driving force behind the lending industry’s growth. In addition, with cloud computing, there is no longer any need for backups, updates, or repairs to the underlying infrastructure. It enhances customer experience, innovation, and productivity, making learning outcomes scalable.
Enhanced Security Measures
Maintaining data integrity by blocking unauthorized access is crucial to cloud storage. Many cloud systems alert administrators of discrepancies by comparing the data to the previous excellent condition. Banks can reduce security threats via thorough audits, multi-factor authentication, and restricted IP address lists by working with a reliable cloud service provider.
By using cloud computing services, organizations can reduce the need for expensive software installations, such as on-site dedicated chat servers. Businesses can cut their IT expenses by paying for just the services they need at the right time using software-as-a-service (SaaS) solutions like ATS tracking systems and customer relationship management tools.
The cloud creates the perfect environment for compliance by anticipating and resolving regulatory demands and identifying and managing risk gaps. Lenders may rest assured knowing that any data they submit is error-free and can be retrieved quickly and easily whenever needed. In addition, businesses will not face any compliance-related fines.
The cloud-based solution is a game-changer for the finance sector. Fintech companies can swiftly roll out new services and keep up with the competition through improvements in scalability, security, user experience, time to market, and data analytics.