Experts have urged local banks to prioritize data security when shifting to a cloud-based technology as they boost efforts to remain competitive.
Over 20 financial institutions have already incorporated cloud-based systems into their core banking solutions, the Bangko Sentral ng Pilipinas (BSP) said earlier.
“As banks transition to cloud-based technologies, it is paramount to ensure that both customers and banks data are protected and secured,” Bank of the Philippine Islands (BPI) Chief Digital Officer Noel Santiago told the BusinessMirror.
Rizal Commercial Banking Corp. (RCBC) Chief Economist Michael L. Ricafort agreed, saying that banks should follow the best practices, along with the prescribed guidelines by the regulators.
Both banking experts said using cloud-based systems is beneficial for the banking industry and its clients, stressing it could drive growth for financial institutions.
Ricafort said cloud-based operations can further hike productivity, improve customer service and optimize work collaboration in a digital space.
Using cloud-based systems “entails further reduction operating costs with reduced use of hardware and physical space requirements, thereby also helping boost cost efficiency as well as overall profitability,” Ricafort added.
At the same time, using such a system is seen boosting bank data, which the RCBC economist said is very important to make well-informed decisions.
“Cloud-based systems and solutions will give banks an advantage in terms of rapid scalability, higher availability, and cost efficiency,” the BPI official said. “This will enable banks to serve more clients with enhanced reliability and accessibility.”
The shift to cloud is parallel with the digitalization initiatives amid the Covid-19 pandemic lockdown and social distancing measures, Ricafort said.
In a joint study by International Data Corp. (IDC) Financial Insights and Huawei Technologies Co. Ltd., it was noted that the Philippine banks were among the financial institutions in the Asia-Pacific region that were using cloud as means of storage management.
The report said there were “some positive developments in markets such as the Philippines and Korea but many [were] still held back by regulatory fear.”
IDC and Huawei said cloud is flexible storage because it allows data to be accessed digitally. It also serves a platform of services and tools which provides quick access to analytic tools and development tools, including artificial intelligence.
BSP Governor Benjamin E. Diokno, in a recent online event, encouraged thrift banks to leverage on technology such as the cloud to reduce their operational costs.
“In order to remain competitive and protect the business, thrift banks need to embrace these emerging trends to make use of available technology, to identify growth opportunities and to establish synergies with other players and industries in order to meet evolving customer demands,” he added.
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