Financial Firms Turn To Hybrid Cloud Storage For Security And Compliance
Navigating security and compliance challenges with the hybrid cloud.
Financial organizations are some of the most risk-averse and regulated businesses in the world. They are also some of the most complex, often burdened with an enormous array of legacy systems and processes. Aron Brand, CTO at CTERA, discusses why these organizations are now realizing that the cloud can help them to be more agile and responsive to the needs of their customers.
Until the 1990s, the mainframe was the engine room of banks and financial institutions. It was the ‘be all and end all’ for these organizations. All client information and associated transactions were processed and stored on these mammoth systems. Mainframes are not going away anytime soon, and companies like IBM are doing a lot of work to modernize these systems and make them more cloud friendly. But we are now at a tipping point.
The cost and effort required to keep mainframes running is becoming prohibitive. At the same time, the cloud is becoming more and more appealing. It is now possible to run all of the same mission critical applications in the cloud that were previously only possible on mainframes.
Why Cloud Transformation Is Necessary
This is why, today, financial institutions are looking to the cloud to provide the agility and flexibility that they need to compete in the digital age. Cloud transformation is essential for these organizations if they are to survive and thrive. There are a number of reasons for this.
Firstly, the cloud provides the elasticity that these organizations need. They can scale up or down as required, without having to make significant capital investments in new hardware. This is particularly important given the volatile and uncertain economic conditions that we are currently facing.
Second, the cloud provides these organizations with the ability to innovate and experiment with game changing technologies, such as big data analytics and machine learning, quickly and cheaply. This is essential if they are to keep up with the pace of change set by fintech startups.
Finally, the cloud enables organizations to offer their customers new and innovative digital experiences that are personalized and convenient. This is something that customers have come to expect and demand.
See More: 3 Factors to Consider When Transitioning to a Hybrid Cloud Strategy
Overcoming Challenges In Cloud Transformation with the Hybrid Cloud
Financial organizations have struggled with cloud transformation for a variety of reasons. The biggest challenge has been data security and compliance. Financial data is highly sensitive, and subject to stringent regulations. For example, the Sarbanes-Oxley Act (SOX) requires financial companies to maintain accurate records of their financial transactions, electronic records and messages. In order to tackle this challenge, financial organizations have chosen to modernize their storage by implementing hybrid cloud storage, supplementing on-premises storage resources with additional storage capacity in the public cloud.
Hybrid cloud storage is the perfect solution for financial organizations because it can offer the same security and compliance of private storage systems, with the cost-effectiveness and flexibility of the public cloud. Hybrid cloud storage exploits public cloud and private cloud storage with data management system coordinating data between the two. The advantages of hybrid cloud is that it enables organizations to seamlessly and cost effectively add to the function of their existing storage, while being able to connect to optimized cloud computing for data analysis. Hybrid architecture can significantly reduce the cost storage solution acquisition by replacing legacy file servers with public object storage like Azure or Amazon S3. Hybrid cloud storage helps organizations optimize access to cloud data from edge computing locations.
Hybrid cloud storage supports the data encryption and safe housing of data in the public cloud. This meets the security and compliance requirements of financial organizations, while still allowing them to take advantage of the cost-effectiveness and flexibility of the public cloud.
Hybrid Cloud is a viable solution for all types of business. It works for organizations with legacy data or companies born in the cloud. Launching a hybrid cloud solution brings with it the ability for a business to deploy existing applications in the cloud without the extra work of coding or architecting a second time. With these ongoing allowances that support low latency and local access, older protocols such as service message block and network file sharing as well as those security standards like Windows NT and access control lists, it is easy to move both endusers and applications and onboard them onto hybrid cloud storage.
For industries with stringent security and rules in place, hybrid cloud storage enables these types of organizations to take advantage of the benefits of the public cloud while avoiding the challenges of compliance and security. In fact, Hybrid cloud storage is also attractive to financial organizations because it allows them to dynamically scale their storage capacity and computing power, as needed. This is essential for businesses that experience spikes in demand, such as during tax season or end-of-quarter reporting. Such organizations are making use of cloud bursting, which is a technique for using the public cloud to supplement the capacity of a private cloud during peak periods. This allows businesses to avoid overprovisioning their private cloud capacity, which can be costly and wasteful, and to take advantage of the public cloud’s pay-as-you-go pricing.
Ensuring Security
From a security perspective, CISOs in the finance sector are currently particularly concerned about ransomware because it can lead to the loss of sensitive data or the inability to access systems. In some cases, ransomware can also encrypt sensitive financial data, which can lead to devastating financial losses. Hybrid cloud storage solutions are uniquely positioned to protect against ransomware by providing an immutable, off-site data copy that can be used to restore files if they are encrypted.
The cloud is transforming and modernizing financial firms. It provides new opportunities for large institutions such as banks and insurance companies to optimize their financial processes, provide better services, and create new efficiencies. With the advent of hybrid cloud storage, companies in this segment can now take advantage of the cost-effectiveness and flexibility of the public cloud while still meeting their security and compliance needs.
Are you tapping into the hybrid cloud to ensure security and compliance? Share your journey with us on Facebook, Twitter, and LinkedIn.
MORE ON HYBRID CLOUD:
Image Source: Shutterstock
