How traditional institutions can raise their game in the cloud

Two community institutions quietly became the first U.S. banks to operate fully in the public cloud, enabling them to match the speed-to-market and flexibility of fintechs. That development, plus the earlier IBM/BofA cloud collaboration, point to a major pivot in industry thinking.

A little-noticed announcement could mark the beginning of the end of one of banking’s most enduring truisms: that traditional institutions are hampered by legacy systems.

Two community banks are now running their institutions in the public cloud. They’ve been doing this successfully for about five months. Both institutions worked with Finastra, their bank technology vendor, to adapt its Fusion Phoenix core system to run on Microsoft’s Azure cloud platform.

The implications reach far beyond the bank IT world. Retail bankers, marketers, digital banking heads, lenders and leaders of other banking disciplines will all benefit from removal of the shackles of legacy technology. Things won’t change overnight, of course, but the industry’s thinking has altered in regard to the cloud.

The distinction between public and private clouds is significant. Simply put, a private cloud is a web-delivered service not shared with any other organization. By contrast, a public cloud shares computing services among different customers, even though each customer’s data and applications remain hidden from other cloud customers, as described by Cloudflare.


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