Connect with us

Technology

Cloud scalability seduces the financial sector

Published

on

By Monica Brink, Director EMEA Marketing, iland

The financial sector, while forging ahead in other areas of digital transformation, has been relatively slow to adopt the cloud and there has been good reason for it: banks have to deal with highly sensitive data and sharing data storage and compute resources with others could not even be envisaged, let alone adopted.

However, just under 2 years ago, the Financial Conduct Authority (FCA) published a new guidance for firms outsourcing to the ‘cloud’ and other third-party IT services which paved the way for banks, insurers and other financial services companies to take advantage of cloud computing services. In this new guidance, the regulator outlined that there was no fundamental reason why cloud services (including public cloud services) couldn’t be implemented, subject to compliance with specific guidance for financial firms outsourcing to the cloud and other third-party IT services.

According to Celent, financial services firms will progressively abandon private data centres and triple the amount of data they upload to the cloud in the next three years. Because of the huge and increasing amounts of data financial services firms need to manage, the scalability of cloud has become an attractive feature – especially considering the fact that the number of daily transactions can stretch into the millions. On top of that, the volume of transactional data is not always predictable, so financial institutions must be able to scale up quickly on demand.

While scalability is an attractive aspect of the cloud for financial firms, it’s important to evaluate scalability in conjunction with other key elements of cloud services including security, cost-effectiveness and transparency.

Monica Brink, Director EMEA Marketing, iland

Combining scalability with security

Security is a key concern for banks as they deal with highly sensitive data and increasing regulations around data privacy, particularly with the EU General Data Protection Regulation (GDPR) coming into force in May, 2018. Even if they are fully responsible for clients’ data security, their cloud services provider (CSP) will maintain the security of the cloud infrastructure their apps and data are hosted on. Therefore, the scalability benefits of cloud must be combined with security features that measure up to on-premises levels of cloud security. The good news is that some cloud providers have significantly improved  security offerings, the best of which have security features such as data encryption, vulnerability scanning, intrusion detection and more baked into the cloud platform and offer full reporting on security and compliance elements which financial services firms increasingly need for auditing purposes.

What used to discourage the financial sector from adopting the cloud is now what’s appealing to it. Banks who take advantage of cloud computing often actually benefit from stronger security safeguards than they are able to invest in for on-premises IT infrastructure. The cloud is certainly more secure than many legacy platforms, so if financial organisations choose the right cloud services provider, they can actually experience a higher level of security than they would via legacy solutions.

However, there’s no question that we’re seeing a rise of cloud-based malware and, according to Palo Alto Networks, 70% of cybersecurity professionals working in large organisations in the UK say the rush to the cloud is not taking full account of the security risks. Even more worrying, the survey reveals that only 15% of UK security professionals were able to maintain consistent, enterprise-class cyber security across their cloud networks and endpoints. Add to this the fact that financial services companies need to scale up quickly in an increasingly regulated environment and you’ll understand why financial firms need to pay careful attention to cloud security and compliance credentials. Choosing a cloud services provider with advanced security features is vital to financial institutions and can help them to report on the security of all of their workloads in the cloud to pass compliance audits.

Combining scalability with cost-effectiveness

Another essential factor for the financial sector when adopting cloud is of course cost. The annual IT spend for global capital markets keeps increasing and, while cloud computing promises many economic benefits, these can only be realised when there’s a good match between cloud workloads and cloud resource utilisation. Cloud computing has the potential to save the industry billions of pounds, as the volume of transactional data increases and the cost of information security escalates in an increasingly complex threat environment.

Some cloud providers, such as iland, enable customers to scale their reserved cloud resources to exactly the amount of GB required. The billing is then determined based on actual compute usage and so customers only pay for what they use. This ensures that customers always have the cloud capacity available, without having to pay for more than what they need. This is far more cost-efficient than provisioning on-premises equipment for maximum workloads and having it lie idle for much of the time.

Combining scalability with transparency

Financial services firms are also seeking transparency into the policies and processes as well as operations of their cloud provider. In recognition of the flexible and collaborative nature of cloud service providers, the new EBA guidancelaunched a few months ago sets out the terms and processes under which chain outsourcing – a cloud provider outsourcing an element of its provision to a third party – is acceptable. As with most aspects of the guidance, strong emphasis is placed on ongoing risk management and transparency between the CSP

Throughout all aspects of the EBA guidelines, it is abundantly clear that the relationship between financial organisations and their CSPs needs to be extremely close and transparent, and conducted at a senior level. Verifiable trust through certification is the linchpin of the whole relationship and the partnership will be dysfunctional (and potentially inviable) without this cornerstone in place. Fortunately, this kind of transparency and commitment to open partnership has been built into the DNA of some cloud providers from the outset. iland, for example, has a dedicated compliance team that focuses on helping customers provide continuous monitoring and evidence of compliant cloud services to regulators.

Overall, financial services firms should not be tentative in taking a step to the cloud; the investment in time and budget in building and managing IT infrastructure can be dramatically reduced and the on-demand scalability benefits are particularly important in this sector. Cloud providers have significantly developed their security capabilities and can offer dedicated, sector-specific support through cloud migration and management. The publication of guidance from regulators at the FCA and EBA, plus the expertise that CSPs have developed for the financial services sector should  give financial services firms more confidence in the cloud and encourage them to fully embrace its possibilities and benefits.

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Technology

HOW ARE SPEECH RECOGNITION AND AI FIGHTING FRAUD?

Published

on

By

Nigel Cannings the founder of Intelligent Voice

Nigel Cannings is the founder of Intelligent Voice

 

Speech recognition and AI provide innovative methods for businesses to significantly develop and improve their fraud detection systems. With the technology and techniques used by fraudsters rapidly changing, AI can evolve and adapt to provide more comprehensive protection, assisted by the use of machine learning. The acceptance of AI as a crucial asset to fraud detection and prevention is already being recognised, with 31% of CIOs having already reported the implementation of AI systems in their business, and a furth 23% expressing intent to have the technology deployed within the next year. Crucial to the effective implementation of this technology, however, is having a basic understanding of how it functions and will assist business needs.

 

What are the roles of AI and machine learning in fraud detection and prevention?

AI can take a variety of forms, with the core systems required for anti-fraud measures being Conversational AI, Natural Language Processing (NLP), and Automatic Speech Recognition (ASR). Automated, voice-enabled applications rely on the use of Conversational AI to allow efficient communication between technology and humans. ASR is the model tasked with translating verbal data into different formats, facilitating the recording and processing of data. The crucial bridging of the gap between the rules of human language and machine learning is carried out by NLP systems, allowing technology to process the sentiment and intent that can be derived from human interaction.

Together, these AI systems are used to both develop and augment machine learning models. The machine learning process involves the application of data from previous interactions with the intent to enable algorithms and analysis to develop and evolve alongside rapidly changing fraudulent technology and techniques. Through the collaboration between machine learning, Conversational AI, NLP, and ASR, data that would have previously been considered difficult or impractical to apply to anti-fraud measures can be repurposed. Fraud detection procedures such as checking for consistency in the details of claimant stories, identifying connections between claimants and witnesses that may be problematic, or detecting more complex behavioural indicators can be carried out more effectively, enabling a more comprehensive anti-fraud system.

 

What are the features that AI can recognise, and how does this help prevent fraud more efficiently?

Modern AI systems have the capabilities to detect a range of both speech and behavioural patterns, providing a more comprehensive analysis of the mannerisms and language features displayed in customer-facing interactions. There are several features that have been traditionally associated with fraudulent intent, with the most notable being frequent pauses in speech, hedging, delaying responses, indirectly answering questions, and displaying heightened emotional responses. AI not only has the ability to detect these traditional features of fraud, but it will also use its recorded history of confirmed fraudulent calls to continue tracking trends in behaviour and speech by fraudsters. Customers who have been identified to be displaying suspicious behaviour can be more closely monitored, and if the potential for fraud is confirmed, customer records can be updated with the necessary information and warnings concerning their claim. Currently, it is possible to also use AI systems to record a biometric voiceprint of known fraudsters, allowing their detection even when they call back with a new claim and different details. Through these measures, it can be possible to detect fraudulent intent from the first phone call.

However, it is important to be aware that these systems and tactics are not static, and constantly evolve depending on the new techniques being adopted by fraudsters to avoid detection. The most recent development in fraudulent operations is the use of “deepfake” technology, which can be used to mimic audio and mask a human voice in real-time. This allows fraudsters to create entirely new identities to recommit fraud with the same company, without being detected by biometric voiceprint technology. Traditional anti-fraud measures without the input of AI and machine learning will struggle to adapt to these new technological challenges. AI-based systems provide the flexibility and adaptability to allow businesses to keep up with these evolved techniques quickly, often with minimal human involvement.

 

How can speech recognition AI impact wider business goals?

The reach of AI is not limited to efficient fraud detection – important business goals such as the improvement of customer services also benefit significantly from the implementation of AI-based systems. Functions such as sentiment and emotion analysis now allow businesses to detect and interpret the nature of customer experiences, identifying positive and negative language and speech indicators. This enables businesses to gain a better understanding of their customer interactions and where improvements or reviews may be required. This form of analysis can also provide more detailed information about whether customers are displaying a sense of urgency, frustration, contentment, or confidence in response to their experience. Details provided by this analysis allows businesses to create more specific targets and methods to increase customer satisfaction.

Implementing wider behavioural analysis through AI systems also provides new opportunities for businesses to provide improved safeguarding for vulnerable customers. Employees can be notified when customers are displaying worrying indicators of being uncertain, confused, or concerned as a result of their interaction, and respond accordingly. These more vulnerable customers are often unemployed, young, or older adults that may require a more in-depth explanation of how the business can serve their personal needs. Follow up contact, reassurance, or in more extreme cases, welfare checks can be provided to these customers. The introduction of more thorough AI-based analysis can feel more intrusive to some customers – however, this technology also enables the provision of better customer care. The shift towards more analytical, adaptive technology increases our capabilities to care for the most vulnerable in society.

 

Nigel Cannings is the founder of Intelligent Voice, a company leading the international development of proactive compliance and technology solutions for various forms of media. His experience in both technology and law provides a unique insight into the future of these technologies and the legalities surrounding them.

Continue Reading

Technology

IS THERE A CASE FOR APPOINTING A DIGITAL TRANSFORMATION OFFICER?

Published

on

By

Stefano Maifreni, founder of Eggcelerate

Stefano Maifreni, founder of Eggcelerate

 

You can tell the business world’s direction by the new roles that start to pop up in the C-Suite. With titles like chief transformation officer, chief change officer, and digital transformation officer, it’s clear what’s on a business leader’s mind these days. Each of these roles is a response to rapidly changing market and customer trends and an avalanche of technological advances that are causing businesses to rethink the way they operate.

In this article, however, we’re going to take a closer look at the Digital Transformation Officer (DTO). This professional is specifically focused on an organisation’s digital strategy and transformation.

Not every company needs to hire someone for this position, however. Sometimes it’s better to get every senior officer involved and lead the company’s digital transformation as a team.

To help you decide whether to bring in a DTO, we’ll offer some points to consider below.

 

What is a DTO, and What Do They Do?

Today, an organisation’s success and long-term sustainability heavily depend on its digital infrastructure combined with a data-driven culture. Smart, automated IT systems enable critical modern business capabilities such as personalisation, adaptability, and innovation. A data-driven culture then leverages the business and market data captured and analysed by these systems to guide business decision making at all levels of the organisation.

Even technology-based businesses, such as fintech companies and SaaS providers, don’t always have the most effective and efficient digital infrastructure in place. Moreover, establishing a well-oiled data-driven culture takes much time, research, and consideration.

It is where a DTO comes in. A DTO is a member of a company’s senior management team. They are responsible for leading a business’s digital transformation in response to the emergence of new critical technologies, significant shifts in the market, or the development of new business products or services, among other events. These professionals work closely with the CEO and the C-suite, but at the same time, they must also collaborate with employees at virtually every level of the company.

Having a strong, focused senior leader at the helm of such an undertaking is thus critical to its success.

 

Three Necessary Qualities to Look for in a DTO

If you decide to hire a DTO, the person you choose for the role must possess several essential qualities to steer your company through a successful digital transformation. These qualities are in addition to technical expertise and general industry knowledge:

 

They can see the big picture.

A DTO must take in the whole picture of your company and determine the critical areas where people, data, and infrastructure interact. They can then leverage that knowledge to implement digital initiatives for every significant business process’s strategic innovation and business transformation.

They must be able to consider the customer’s experience and needs as the agent and driver for change, on the one hand, while understanding the unique needs and culture of your business on the other. It includes understanding how people and departments interact and how third-party vendors and service providers fit into the system. The goal is to balance the company-wide need for change and adaptation with consideration for employee needs for consistency, stability, and clarity.

 

They possess good communication and collaboration skills.

While the role requires a wide range of soft skills, abilities in communication and collaboration are at the top of the list. A DTO must speak to a broad spectrum of people at every level of the company. It is crucial not only for gathering information and feedback but for encouraging employee buy-in in response to change. It (almost) goes without saying that a big part of communication is not just speaking to others but listening to what is being said or reported honestly.

 

They are humble and able to learn from others.

This role involves gathering a lot of input from employees at the lowest ranks of a company, particularly those directly involved with customers, such as sales and customer service representatives. At the same time, DTOs must report to the CEO and collaborate with other C-Suite executives. To do this properly, a good DTO must be open and willing to learn from others, consider different ideas and opinions, and be ready to course-correct when an initiative goes off track.

 

Not Every Company Needs a DTO

While many companies may want to pass the responsibilities of a DTO on to a specific individual, so they are free to focus on other areas of the business, it may not be the best decision. Here are a few reasons why:

  • Unlike traditional C-Suite roles, the DTO is transient by design. It means that companies usually employ a DTO to get a digital transformation off the ground. Once the change is fully integrated into the company’s operations, the DTO is no longer needed. With the proper infrastructure and data-driven culture in place, digital transformation and innovation self-perpetuates.
  • Another issue is that companies typically hire an outsider to fill the role of DTO. While this may give the company access to a fresh perspective, an outsider working in a transitory position may not be willing or able to reach the level of understanding– whether of the company or the market it serves– needed to make the most effective decisions.
  • Because digital infrastructure and adaptability are key business competencies, direct involvement in the digital transformation process helps senior leaders improve their strategic decisions overall.

While companies that rely on analogue processes may benefit from a dedicated DTO, in many cases, appointing a DTO is not in the best interest of an already digitally aligned company. It may be much more effective to create a company-wide commitment with a team of senior leaders responsible for the digital transformation, rather than passing the details and management of the transition off to one individual.

 

Continue Reading

Magazine

Trending

HOW TO TELL IF YOU’RE OVERPAYING TAXES HOW TO TELL IF YOU’RE OVERPAYING TAXES
Finance20 hours ago

HOW TO TELL IF YOU’RE OVERPAYING TAXES

Paying taxes is a necessary act in our world, and with good reason. Our governments use taxes to build the...

Nigel Cannings the founder of Intelligent Voice Nigel Cannings the founder of Intelligent Voice
Technology3 days ago

HOW ARE SPEECH RECOGNITION AND AI FIGHTING FRAUD?

Nigel Cannings is the founder of Intelligent Voice   Speech recognition and AI provide innovative methods for businesses to significantly...

HOW CAN BUSINESSES BREAK INTO MARKETS BEYOND THE EU? HOW CAN BUSINESSES BREAK INTO MARKETS BEYOND THE EU?
Business3 days ago

HOW CAN BUSINESSES BREAK INTO MARKETS BEYOND THE EU?

Atul Bhakta, CEO of One World Express   The build-up and aftermath of Brexit impeded the long-term plans of businesses...

BUSINESS DEVELOPMENT + MARKETING + COMMUNICATIONS BUSINESS DEVELOPMENT + MARKETING + COMMUNICATIONS
News3 days ago

BUSINESS DEVELOPMENT + MARKETING + COMMUNICATIONS

Volante Technologies Recognized as Market Leader in Omdia Universe: Selecting a Payment Hub, 2021-22 Report Cloud payments company scores highest...

Dima Kats, CEO, Clear Junction Dima Kats, CEO, Clear Junction
Top 103 days ago

2022: A FUTURE FOR SIMPLE AND FRICTIONLESS CROSS-BORDER PAYMENTS

Dima Kats, CEO, Clear Junction   Even after 18 months of stuttered lockdowns, businesses are still learning how to navigate...

Christmas Gifts Christmas Gifts
Top 103 days ago

CHRISTMAS IS COMING: WHAT MAKES A GREAT ECOMMERCE STRATEGY FOR THE FESTIVE SEASON?

By Laura Lough, Director of Ecommerce Operations at Digital River   There is no doubt the year 2020 presented an...

Stefano Maifreni, founder of Eggcelerate Stefano Maifreni, founder of Eggcelerate
Technology3 days ago

IS THERE A CASE FOR APPOINTING A DIGITAL TRANSFORMATION OFFICER?

Stefano Maifreni, founder of Eggcelerate   You can tell the business world’s direction by the new roles that start to...

Business3 days ago

WHAT FIREFIGHTERS CAN TEACH FINANCIAL INSTITUTIONS ABOUT DATA COLLABORATION

Gabriele Albarosa, CEO, LiveDataset   Digital transformation can be difficult for any business, but in the financial services industry it...

Top 103 days ago

HIDDEN COSTS WHEN INVESTING… AND HOW NOT TO GET HIT

By Annie Charalambous, Head of Communications at ETX Capital   According to recent figures, Brits plan to increase their investments by almost...

INSURANCE TRENDS 2022 INSURANCE TRENDS 2022
Top 104 days ago

INSURANCE TRENDS 2022

The Insurance market will continue to grow in maturity based on the richness of solutions by InsurTech In 2022, we’re...

News4 days ago

ARTERIA AI SET TO ACQUIRE H4’S FINANCIAL SERVICES BUSINESS ASSETS

H4 Chairman and Co-founder Joe Seifert to join Arteria AI as senior advisor   Arteria AI, an award-winning global leader...

News4 days ago

PAYNET PARTNERS WITH CLEAR JUNCTION TO FACILITATE CROSS-BORDER PAYMENT SERVICES

Clear Junction announces new partnership with Paynet The partnership helps Paynet provide remittance services to typically underserved communities   Clear...

News4 days ago

GAME CHANGING: WORLD’S FIRST ON MOBILE DEVICE NEURAL TEXT-TO-SPEECH SYSTEM RELEASED BY CEREPROC

CereProc has today launched the world’s first on mobile device neural Text-to-Speech (TTS) system commercially available for Android and iOS operating...

News4 days ago

VIRGIN MONEY ADDS ACCELERATED PAYMENTS TO ITS FINTECH PARTNERSHIPS

An Invoice Finance provider addressing cash flow issues in business Partnership forms part of Virgin Money’s working capital health proposition Virgin Money...

Business4 days ago

B4B PAYMENTS PARTNERS WITH SENTINELS TO SUPPORT ANTI-MONEY LAUNDERING COMPLIANCE ACROSS EUROPEAN MARKETS

Sentinels’ risk-based model boosts accurate detection rates and provides flexibility to monitor transactions across all B4B Payments’ solutions Sentinels, Europe’s leading...

Business4 days ago

EPI: HOW TO BUILD TRUST AND ADOPTION AMONG CONSUMERS AND MERCHANTS

By Arnaud Crouzet, VP Security & Consulting at Fime   What is EPI? The European Payments Initiative (EPI) is aiming...

Interviews4 days ago

BATON SYSTEMS 2022 OUTLOOK

Responses provided by Jerome Kemp, President, Baton Systems   Q. Organisations are forecast to spend nearly $6.6 billion on blockchain...

Finance4 days ago

WHY THE EXPLOSION IN LOCAL RETAIL DEMANDS NEW PAYMENT METHODS

Kasper Enggaard Krog, CEO at mobile payment and business technology firm, Vibrant, explains why micro businesses are being badly let...

Business5 days ago

IS SCARCITY OF TALENT THREATENING THE UK’S FINTECH CROWN?

Opinion From Rafa Plantier, Head of UK and Ireland at Tink   From the Square Mile to Canary Wharf, London...

SET YOUR BUSINESS UP FOR SALES SUCCESS IN A POST-PANDEMIC WORLD SET YOUR BUSINESS UP FOR SALES SUCCESS IN A POST-PANDEMIC WORLD
Business1 week ago

SET YOUR BUSINESS UP FOR SALES SUCCESS IN A POST-PANDEMIC WORLD

Dean Fiveash, Head of FinTech Sales, IFX Without doubt the Coronavirus pandemic impacted every aspect of our lives and fundamentally...

Trending