Globally, the financial services industry has outpaced other sectors in hybrid cloud adoption, with the technology’s embrace reaching 21% of the sector, said a survey by US-based cloud computing firm Nutanix, Inc., which has founders of Indian origin. This is higher than the overall industry average of 18.5%.
According to Nutanix, financial services firms are increasingly facing pressure to streamline operations while delivering a differentiated experience to their customers, including leveraging new technologies such as blockchain. The large institutions are facing mounting competition from disruptive services being offered by heavily-funded fintech startups.
While the financial services sector was bullish about hybrid cloud adoption, the report said that the segment cited security and compliance as the top factor in deciding where to run its workloads. The industry also ran more traditional data centres than other industries, with 46% penetration. Meanwhile, they also had lower usage levels of private clouds than any other industry, at 29% compared to the average of 33%.
“Increased competition, combined with more stringent regulatory and compliance environments, is forcing the entire industry to re-assess the capability and relevance of its current information technology (IT) infrastructure,” said Neville Vincent, vice-president, Australia and New Zealand, Asean (Association of Southeast Asian Nations) and India, Nutanix. He added that while the financial services industry was already seeing the customer and company benefits of hybrid cloud infrastructure, there was still a long way to go to satisfy increasingly sophisticated and demanding customers.
Nutanix said that the fintech revolution, combined with the growing burden of regulatory compliance, data privacy, and security issues, is pushing chief information officers (CIOs) to fundamentally transform the technology deployed at these institutions. It also added that the industry was embracing the capabilities of cloud computing to address these needs.
These findings were announced in Nutanix's survey called 'Enterprise Cloud Index Report', which measured the firms’ plans for adopting private, public and hybrid clouds. Part of the report findings was released earlier, which said that 43% of Indian enterprises will adopt hybrid cloud by 2020.
More than a third (36%) of organisations using public clouds said their public cloud spending exceeded budgets.
Organisations that use public cloud spend 26% of their annual IT budget on public cloud, with this percentage expected to increase to 35% in two years’ time. In comparison, 33% of financial respondents reported being over budget, revealing that they are doing marginally better than others at managing public cloud expenses, it added.
“Legacy systems and processes are significant impediments to the agility that today’s business demands. The BFSI (banking, financial services and insurance) segment in India has been a trailblazer in the adoption of new technologies such as hybrid cloud, artificial intelligence (AI) and machine learning (ML). For us, the hybrid cloud is at the forefront of our IT vision and strategy for driving agility in responding to business and customer needs across channels and products,” said Sankarson Banerjee, CIO at RBL Bank.
Nutanix said that the bullish outlook for hybrid cloud adoption globally and across industries is reflective of an IT landscape which was growing increasingly automated and flexible. This also gives enterprises the choice to buy, build, or rent their IT infrastructure resources based on fast-transforming application requirements, it added.
Earlier last month, enterprise technology giant Hewlett Packard Enterprise (HPE) had partnered Nutanix to provide hybrid cloud as a service.