As the UK’s Nationwide Building Society moves towards a cloud native payment platform, experts caution that phased migration is necessary. The company announced, on 6th March, that it would partner with Accenture and payment technology company Form3 to create a payment infrastructure with faster and more secure transactions.
Cloud native technology essentially, “provides users with an approach to consuming IT that is significantly more flexible, resource-efficient and cost-effective than traditional IT,” according to a Thematic Intelligence: Cloud Computing Technology report.
Lead analyst for thematic and fintech research at GlobalData, Stephen Walker, stresses the importance of phased migration. “Paths vary, but most institutions favour progressive renovation so as to avoid the “big bang” migration gone wrong,” says Walker.
For example, “TSB in March 2018, when customers were locked out of accounts for days, the CEO was forced to resigned, the bank’s share price was nearly cut in half, and costs and fines reached the many hundreds of millions, not to mention the incalculable reputational damage,” adds Walker.
However, with this warning in mind, cloud native transformation will be an area of key growth in 2023 as 26% of respondents in GlobalData’s executive survey of tech decision-makers reported a significant increase (more than 6%) in business investment in cloud technology in 2022 compared to 2021.
“We expect the same in 2023 – a reminder that the ‘new normal’ in spending is not just the increase last year, but how that increase puts each subsequent year on an entirely new growth trajectory,” according to Walker.
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Founder and CTO, Vladi Shulman, at software development company ProfiSea Labs also states, “Investment in cloud native is a must today. Cloud native enables banks to be quick to market and more agile.
By migrating to the cloud, banks can offer more services and a better user experience to their customers.”
An example of a successful migration is the case of DBS Bank, a phased migration in which the company containerised legacy applications so it could adopt public cloud at scale while chipping away at core banking systems.