Overcoming security concerns, the majority of financial services firms in the US and Asia Pacific have embraced cloud technology, won over by the potential for massive cost savings, according to research from IDC Financial Insights.
After years of caution driven by security and regulatory uncertainty, and despite last month's massive Amazon cloud services outage, financial services firms are determined to push ahead with adoption, egged on by providers that include tech giants Google and Microsoft.
Most banks in Asia Pacific are now in the first stages of cloud maturity, says IDC, with 80% of these firms expected to run on a hybrid cloud architecture by next year.
The cloud will become the "fundamental technology" underpinning the digital transformation banks must undergo, claims the report, and early adopters will see take-out costs of up to 20% between now and 2019.
About two thirds of global FS firms will be using cloud services in a significant way by next year, slashing infrastructure costs by a quarter and saving billions of dollars.
Michael Araneta, associate VP, IDC Asia/Pacific, says: "With growing regulatory support for cloud and the intensifying competitive pressures forcing Asia/Pacific banks to look at what cloud can offer in terms of cost take-out and quicker go-to-market, cloud adoption will scale up this 2017."
Meanwhile, separate IDC research shows that a quarter of Asia Pacific banks will have an API strategy by 2018.
The report argues that in the long term for banks, the strategy to open their APIs will decide whether they are disintermediated by fintech companies and lose revenue to competition or they collaborate with third party providers and create more avenues of value and revenue creation.