Banks are doing what they can to reduce the risk of using cloud computing services, according to a survey by Google Cloud and Harris Poll. The Bank of England and the Bank of France have voiced concerns about the lack of transparency, citing that banks rely on a concentrated group of outside cloud computing providers Microsoft, Amazon, and Google.
The problem with outside providers is that they are usually out of regulators’ reach.
Regulators worry that banks’ reliance on the same providers may create systemic risk if one of the cloud companies were to experience downtime.
Over 1,300 leaders in financial services from Canada, France, Japan, Australia, Britain, Hong Kong, and Singapore showed that 83% use the cloud as part of their core computing infrastructure.
Many companies have considered adopting a multi-cloud strategy that would allow a bank to switch to another provider in case of an outage to avoid service interruption for customers.
Last year saw the pandemic disrupt every industry on the planet, including banking. As such, banks outsourced key services to cloud computing companies to improve efficiency and save money.
The plan to change things for the better
Adrian Poole, the director for financial services in Britain and Ireland for Google Cloud, said that based on the survey, it is clear that financial institutions are taking steps to solve the concentration and avoid getting locked into one vendor.
Poole added that of the respondents queried, 88% of those currently not utilizing a multi-cloud strategy plan to adopt one in the next 12 months.
To tackle this problem, the banks will have to take a broader approach that involves other regulators and overseas partners.