The financial services sector is swiftly undergoing a digital transformation, putting pressure on technology leaders to modernise legacy systems while maintaining compliance and security. Hosted private cloud is emerging as the preferred model to strike this delicate balance, particularly for financial institutions facing complex digital landscapes.
According to Andrew Bennett, Business Development Manager at Routed, institutional decision-makers aren't asking if but how to move to the cloud in a way that manages risk, avoids lock-in, and still enables innovation. He said "Hosted private cloud delivers the agility and scalability you’d expect from public cloud, but with the control, predictability, and compliance advantages of a private environment."
A hybrid approach is often the reality for financial institutions. Bennett notes that core banking platforms and compliance-intensive workloads thrive in secure, private environments, while digital services, like mobile banking apps, leverage the scalability of public cloud solutions. This strategic placement of workloads is essential for banks and insurers aiming to marry stability with innovation.
The "best of both" approach offered by hosted private cloud extends to managing risks effectively. By keeping critical systems in secure, locally hosted environments, organisations can guarantee high availability and disaster recovery, sidestepping the vendor lock-in often tied to integrated public cloud services.
Bennett warns of the migration barriers the tool public cloud providers offer may present, saying that, as a solution, he sees institution are using public cloud for infrastructure but also in house capabilities for developing modern services. Routed's hosted private cloud model also simplifies billing and contract management.
In industries like financial services, compliance with frameworks such as PCI DSS and ISO27001 governs all infrastructure decisions. Additionally, data sovereignty has become pivotal amidst geopolitical shifts. Bennett cites the US CLOUD Act as a key consideration, influencing the preference for locally managed data solutions that abide by local frameworks like South Africa’s POPIA.
Looking to the future, Bennett envisions a hybrid model by default for the sector. Hosted private cloud will play a vital role in this evolution, fostering innovation without compromising security or compliance.
Routed continues to bolster its offerings through investment in local infrastructure and expertise, ensuring that financial institutions can drive forward with confidence.
