Cloud Computing – A Key Enabler of Financial Inclusion


Over the past three years, the banking sector has undergone a digital transformation driven by the pandemic, resulting in an increased digital presence. Many financial institutions ventured into this space and quickly recognized its numerous advantages. Simultaneously, customers embraced the services offered through this digital shift.

According to the 2023 BAI Research, about 55% of respondents expressed willingness to switch institutions for enhanced digital capabilities, marking a significant rise from the previous year. Notably, 75% of Gen Z respondents indicated their openness to changing banks for improved digital offerings, a 13% increase from 2022.

To attract and retain customers, particularly Gen Z, an enhanced digital experience stands as the best approach. Customers in this segment are expected to pursue the most advanced technology available. Relying solely on brand loyalty is insufficient to ensure success for banks.

Enhancing customer engagement and satisfaction ranks as a top priority for the banking sector, with cloud technology being a key driver in these efforts. Cloud computing holds the potential to be a pivotal facilitator of financial inclusion, especially in developing nations where access to financial services is limited. Notably, Google’s investment of USD 120 billion in Artificial Intelligence and Cloud Computing, as reported by Bank of America, underscores this trend.

Benefits for the banking sector stemming from the adoption of cloud computing technology are substantial and contribute to advancing financial inclusion:

  • Cost-Effectiveness: Cloud computing significantly reduces the cost of delivering financial services by eliminating the need for expensive IT infrastructure like servers, storage devices, and software licenses. The resulting cost savings can be transferred to customers, making financial services more affordable and accessible.
  • Creating a New Marketplace: Embracing cloud technology creates a marketplace for novel applications and platforms, some of which might not be available in in-house solutions. Banks can view cloud adoption as a core goal to attain a competitive edge for their customers. For instance, HSBC has partnered with cloud service providers like Amazon Web Services, Microsoft Azure, and Google Cloud Platform to enhance customer experience and operational efficiency.
  • Scalability: Cloud computing allows the banking industry to easily adjust its IT infrastructure based on changing business needs, crucial for the rapid expansion of customer bases without significant capital expenditure. For Example, Capital One, a major US bank, extensively utilizes cloud computing to host its mobile banking app, customer-facing websites, and digital services, resulting in cost reduction, improved scalability, and accelerated innovation.
  • Enhanced Accessibility: Cloud computing empowers financial institutions to offer services through various channels, particularly mobile devices – a primary means of internet access. This facilitates the use of financial services even in remote areas with limited physical infrastructure, providing customers with access to their financial information whenever and wherever needed.
  • Security: Cloud computing providers offer advanced security features like encryption and multi-factor authentication, safeguarding sensitive financial data. This technology also enables banks to store data in multiple locations for business continuity during disasters, fostering trust in financial services.

In Conclusion: The use of cloud technology in banking is gaining traction, with many banks adopting it to enhance operations and remain competitive in the digital era. Cloud technology has transitioned from a desirable option to an essential one. By making financial services more affordable, accessible, and secure, cloud computing plays a pivotal role in advancing financial inclusion.

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