Banking Clouds V International Youth Banking Forum

Cloud Computing is a hot and up-to-date model of internet-based, new generation information technologies. The market for cloud services is expected to grow in the next few years. According to research firm Gartner, this market will increase from $36 billion today to $160 billion by 2015.

Cloud computing allows individuals and companies to use software applications remotely without hosting them themselves.

What are clouds? Gmail and other mail services, Google Docs, – you don’t save a data on your hard-drive, your information is stored on remote servers.

Modern banking system Core banking system(CBS) includes pack of Trade finance, Treasure, Credit Card, Mutual Funds, Stocks, Bonds, External System, Payment gateways, SWIFT, Shared ATM network, World Wide credit card networks World Wide ATM (банк-автоматы) networks.

Cloud computing is the service of the future Characteristics of cloud services are the following: Little or no capital investment required Variable pricing based on consumption; buyers “pay per use” Rapid acquisition and deployment Lower ongoing operating costs Programmable.

Cloud computing includes several benefits over traditional Core banking system Cost reduction, Reduced Capital Expenditure, Scalability, Increased Storage, Improved service levels, Quality of service, Fast and easy implementation and Highly Automated

Cloud computing can be categorized into: Infrastructure as a service (IaaS): Banks share infrastructure among several users creates a market. Infrastructure allows customers to carry out own development or hosting of solutions. Database as a service (DaaS): Vendors offer database storage. Typically, DaaS uses a multi- tenant architecture, where the data of many users is kept in the same physical database or table. Software as a service (SaaS): The original Cloud application, SaaS refers to applications offered as a monthly subscription service.

High speed of banking service: money transfers are faster because all banks are integrated in one cloud. Less risks: the trajectory of the movement of information (money) is short. Not from one city to another one, but from one server to another one which can be in one big room. The simpler collaboration: information form different banks can be integrated easier. Rapid provisioning and elastic scaling of services: This flexibility helps business to respond to changing business requirements in an efficient and cost-effective way by paying for capabilities being used. Allow the IT department to focus on competencies that are core to the business: the IT department can shift its focus from tactical problems such as constant software patches, platform maintenance and other computing issues, to strategic IT projects. Potential benefits

Dark side of cloud computing includes Increased dependency on third party, Performance, Downtime/Disaster management, Data integrity, Control issues, Regulations, Security and Risk.

1) Data integrity, control issues, regulations, Security and risk are the biggest concern about cloud computing for banking business scenario. According to research made by TechMarketView. 44 per cent of bank executives see the lack of data security 15 per cent of respondents are currently running cloud applications.

2) Storing eggs in one basket One cloud clubs various different database. If a hackers breaks one cloud, they are going to have access to hundreds client’s database.

3) Access of internet/WAN Cost of bandwidth and other services will be higher which depends on type of application and data intensity. Disaster recovery and system failure is an important concern because in cloud computing we will effect multiple systems at same time.

Cloud computing is a very emerging technology trend. Most of the banks are already using clouds for credit card and money transfer via SWIFT. Security is going to be improved day by day because many financial institutions and banks will have the central cloud area. It is still new technology and progressing rapidly.