Neal Suggs (centre left), the Vice President and Deputy General Counsel of Microsoft, and associates taking a group photo
According to a study by Forrester Consulting, there are still too many organizations in the sector lacking a thorough understanding of cloud-related banking regulations in order to completely embrace and take advantage of cloud computing. The study was commissioned by Microsoft, ‘Cloud is Critical to Digital Transformation in the Asia Pacific Financial Sector’, evaluated cloud adoption trends among FSI in Asia Pacific and gauged their knowledge and perceptions of cloud-related financial regulations.
One key finding from the study was that leading FSI in the region is actually using regulations to help steer public cloud initiatives, and not as an excuse to stop them. The better the firms’ understanding of regulations, the more likely they are to embrace public cloud services. In most instances, these initiatives are directly tied to customer-facing, digital banking capabilities like new customer acquisition and on-boarding.
“Today the attitudes toward implementing cloud and the related internal policies among FSI in Asia Pacific is clearly maturing as it is increasingly seen as an enabler of the organization’s journey to digital transformation. But it is important to realize that a cloud strategy can only be successful if there is a clear understanding of cloud-related regulations. As organizations’ understanding of regulations increases, so too does their understanding of how and when to engage regulators and, then in turn, their readiness to adopt cloud solutions,” said Jeff Bullwinkel, associate general counsel & director, Corporate, External, and Legal Affairs (CELA), Microsoft Asia Pacific & Japan.
Other highlights from the study include:
- In both mature and high-growth markets, firms interviewed for this study illustrated a lack of regulatory knowledge, citing perceived restrictions to cloud adoption/usage that aren’t actually
present in regulations. - Defining strategies for engaging and interacting with banking regulators has become crucial. As firms’ understanding of cloud regulations increases, so too does their understanding of how and
when to engage regulators. Banks are reaching out to regulators more proactively and frequently to build relationships, establish trust, and address potential compliance issues earlier in the process. - Cloud providers are viewed as an essential part of the banking ecosystem in most Asia Pacific markets. FSI do not consider cloud providers to be mere passive utilities. Instead, they are expected
to actively engage regulators to help shape their cloud delivery models and practices, thereby ensuring that proposed cloud initiatives are compliant with local (and regional) regulations and, hence, are more likely to be approved and implemented.
The study was conducted from November 2015 to February 2016, and involved in-depth interviews with 34 senior IT decision-makers in the Asia Pacific financial services sector from nine markets: Australia, Hong Kong, Korea, Malaysia, New Zealand, Philippines, Indonesia, Singapore and the Philippines. Forrester found that these organizations are at vastly different levels of maturity in cloud understanding and adoption.
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