The integration of FinTech continues to revolutionize the way businesses interact with their consumers. What started as a viable solution to eliminating the need to carry physical currency has now become a multi-billion-dollar industry.
Basically, FinTech is a catch-all term used to describe software, mobile applications and other integrated technologies that improve and automate traditional forms of finance for businesses and their consumers. The financial infrastructure-as-a-service (IaaS) focuses on enabling FinTech companies to quickly facilitate highly secure transactions among an internal network while improving user experience. The complex (yet efficient) solution helps streamline fiscal transactions while simultaneously eliminating unnecessary steps throughout the transaction process. Ultimately, making financial transactions more affordable and accessible.
The integration of FinTech continues to bolster unprecedented growth within the business sector. The industry’s rapid growth can be attributed to a shift in consumers’ lifestyles towards more accessible and affordable solutions. As a result, FinTech has been able to solidify a prominent role within business operations, however, needs to remain vigilant in adapting infrastructures to satisfy ever-changing consumer and industry demands.
With this goal in mind, FinTech companies have begun to innovate new solutions which include embracing the cloud within its infrastructures. With new integration, companies will have to determine whether using fintech-cloud computing entities will ultimately be an asset in achieving longevity and lucrative business growth or not.
FinTech Meets Cloud
FinTech companies are rapidly turning to the cloud to provide businesses and consumers with effective solutions. According to a research study, 87% of enterprises plan to accelerate their cloud migration by 2025. So, why is cloud computing becoming imperative for FinTech companies to integrate?
1. Agility: For businesses to compete, they must stay ahead of the competitive curve by reacting quickly to market changes. Cloud services satisfy this need by enabling companies to accelerate its scaling process. Businesses can scale their capacity up or down quickly to meet customer demand in real-time. As a result, providing a more cost-efficient solution.
2. Competitive Advantage: Within the financial industry’s competitive landscape, it can be quite difficult for smaller companies to gain significant market share. Likewise, larger corporations struggle to retain customers as internal legacy IT practices hinder reaction rate times to changing customer demands. The cloud provides both entities with a better way to compete by offering a quicker alternative to meeting customers’ demands.
3. Enhanced Customer Experience: Millennials and Gen Z have transformed the banking industry by starting to view finances through the lens of technology. Cloud computing offers FinTech companies the opportunity to promote enhanced customer experience with consumer-centric web applications and improved efficiency metrics. Ultimately, providing the next generation of consumers with an accessible, agile and much more manageable solution that adheres to their technology-savvy lifestyle.
4. Cost-Effective: Businesses can incur significant infrastructure costs while developing and deploying FinTech products for a large customer base. Cloud adoption can help cut down costs by limiting usage, promoting elasticity of its products and adhering to an all-inclusive price.
5. Amplified Security Measures: With the ecosystem of hackers and cybercriminals continuing to evolve, companies must remain proactive in mitigating the potential risk of data breaches and cyberattacks. FinTech applications with weak security measures can compromise customer data and other private information. Consequently, leaving the door open to exploitation by malicious operators. Hybrid cloud architecture provides a more secure framework by allowing companies to build their own solutions in the cloud infrastructure they own, rather than in a shared environment within a shared network. As a result, they can be proactive and help eliminate potential data security risks.
Limitations of FinTech: Enhancing Cloud Integration
Cloud computing integration continues to provide FinTech companies the opportunity to accelerate business growth. While there are a number of FinTech companies that have managed to achieve great success while using these infrastructures, other companies have failed.
Any company that invests in FinTech (or any other public cloud service) is susceptible to potential disadvantages. It’s important that companies begin to identify these potential challenges and actively try to avoid them.
Here are potential limitations to consider:
1. Refusing to Use Existing Tools: Change is difficult to manage. Nevertheless, it’s important that companies continue to embrace new technology as they emerge. If FinTech companies refuse to build platforms using current technology, they run the risk of an influx of user discrepancies. On the contrary, if they decide to scale up, they run the risk of hindering the agility of the entire company. By using existing and open source technology, companies can proactively fix their problems and promote continuity in their infrastructures by eliminating outdated data, obscure patches and massive inefficiencies.
2. Ignoring Scope and Capacity: Using FinTech engineering requires an abundance of capacity planning to ensure an effective solution is created. Without planning, companies run the risk of creating infrastructures that cannot accommodate the volume of metrics used. This can result in killing dashboard performance and making troubleshooting issues impossible. It’s important to plan at every stage regardless of what providers are used.
3. The Desire to Implement More than Required: Amid a fast-paced and competitive industry, FinTech engineers are constantly implementing new innovations to solidify their competitive advantage. It’s important companies continue to innovate and improve their products; however, operations should not stray too far from their original scope of work. Businesses should work to eliminate unnecessary additions within their projects that could result in wasting a considerable amount of time and resources. Keep simple tasks simple.
4. Plan and Evaluate: Businesses need flexibility, independence and a cost structure to thrive. To achieve these marks, it’s necessary for companies to take the time to plan and evaluate each offering to determine which solution accommodates their business needs. Although switching providers might seem doable, doing so can result in a more complicated and expensive solution. Setting long-term objectives before deciding on a provider could make that eventual move simpler for your team.
The integration of FinTech and cloud computing services continues to impact the technology, finance and business sectors. The question of whether a FinTech-cloud computing structure is a more viable solution in businesses remains. By planning and evaluating each financial solution, businesses can determine which FinTech service is the most feasible for optimizing business objectives.
FinTech companies will always continue to provide safe and seamless solutions for their customers, however, it’s the companies who can capitalize on efficiency that will rise to the top. As FinTech and cloud integration continues to revolutionize customer-brand solutions, we will become closer to unveiling the future of FinTech and the lasting impacts it has on society.