PaaS, cloud and instant payments in the spotlight: Overcoming outsourcing challenges

 

• What makes outsourcing irresistible for banks today? How are leading change agents and market trends reshaping the landscape, offering unparalleled opportunities for growth and efficiency?
• How can banks master the art of delegation? What are the secrets to distinguishing which responsibilities could be entrusted to third parties and which should remain under their control?
• What regulatory forces are propelling banks towards outsourcing? What is the impact of instant payments, ISO 20022 and DORA on the industry, and what is the time investment required to stay compliant?
• How should banks choose their strategic engines for modernisation? What are the exciting possibilities of cloud solutions and how can they revolutionise operations and unlock efficiency savings and gains?
• What lies ahead for those that embrace outsourcing? Can there be a future where banks can concentrate on the customer, value-added activities, and innovative product development, leaving processing tasks to trusted partners?

 

In the fiercely competitive banking market, the pace of change is accelerating. Outsourcing in banking, particularly in the context of PaaS and cloud solutions, presents a host of challenges and considerations for financial institutions. You need strong, agile, advanced technology to get money moving in real time and bring instant payment services to market faster. The potential for these technologies to unlock growth, improve speed to market and return on investment, and offer personalised services is central.

As the banking landscape evolves, the integration of cloud technologies and platform services is recognised as a powerful tool to help banks stay competitive and meet the growing demands of the market. However, it becomes clear that the implementation of these technologies also introduces complex risks that must be carefully managed.

The evolving pressures have shifted the views of many banks on outsourcing, as they now face stricter rules surrounding data security, compliance, and operational standards. Regulatory concerns such as DORA are driving many banks to reassess how they handle third-party relationships, particularly when dealing with cloud providers and other outsourced services. This shift in perspective requires careful consideration of both the opportunities and risks.

The role of outsourcing must include helping banks respond to rapid industry shifts, such as the rise of instant payments, the demand for instant everything and the need to modernise legacy systems. The pressures of modernisation, particularly related to ISO 20022 migration and adopting cloud technologies, are significant drivers. Cloud solutions present an attractive way for banks to streamline operations, reduce costs, and improve scalability while addressing the ever-growing demand for faster, always on and available, and more efficient payment systems. However, this is not without its challenges, especially as banks face the eternal battle of innovation versus regulatory compliance.

The growing trend of banks attempting to shift responsibility for key functions to third-party providers, yet emphasise that they remain liable for compliance and operational performance must be done efficiently. The increasing reliance on third parties raises concerns about the risks of losing control over critical processes, which can affect the bank’s ability to ensure high levels of service and meet regulatory requirements.

Sign up for this Finextra webinar, hosted in association with FIS, to join our panel of industry experts who will explore the regulatory pressures driving banks to consider outsourcing.