5 Key Challenges Financial Services IT Face in 2022 and Beyond

Many challenges lay ahead for financial services IT in 2022 and beyond.  Between delighting customers with the newest whiz-bang app feature and minimizing data breaches, they must also balance new regulatory requirements which, if not met, can result in costly fines and reputational damage.  At the end of 2021, a New York City headquartered, 220-year-old bank was fined over $200 million in regulatory fees due to insecure practices – namely employees using non-corporate or personal email accounts to transact official business.

To help define the scope of finance services IT priorities, we have identified five key challenges that must be overcome to realize growth expectations.

 

Proactive data and threat monitoring and mitigation

Security will always be a top priority for Financial Services, as their customers demand high levels of privacy. Financial data protection requires proactive, constant, and real-time monitoring by technology, plus a professional security analyst monitoring transactions, networks, and systems. Cyber-defense is not an area to cut costs; instead, this is an area to fortify if resources permit. Investments in automation, machine learning, and data analytics can support these security professionals. Though vigilant security may be costly and time-consuming, the cost is higher if you don’t defend your network against the constant barrage of cyberthreats.1

 

Navigating evolving regulatory compliance guidelines

Evolving technology and new security threats drive continuous changes in local and global regulatory standards. Research shows that roughly 20 percent of senior executives named compliance their major challenge.2 Expertise and focus are required to keep abreast of the new regulations. Choosing well-versed partners and vendors in these new regulations is the safest bet. The opportunity cost of non-compliance is risky. Time to market, productivity, and reputation, not to mention penalties and fines, must all be considered.

 

Optimize the digital experience at scale

In the past few years, the explosion of devices, apps, and global users has increased usage and has required scalability at a moment’s notice. Today’s customers demand an always-on experience. Add this to the current expectation of network uptime and nonstop resiliency of OLTP systems, and the challenge to meet the customers’ rising expectations is clear. To meet this challenge head-on, IT teams need access to the right architectural and operational expertise for technology solutions that help you scale to handle increased customer engagement and grow into new revenue opportunities. Even more, guidance from experts familiar with your in-house systems can aid in deploying new solutions while your existing teams keep services running 24×7.

 

Legacy systems impact on digital transformation

Some banks have “skeletons” in their closets. Tried and true legacy systems from a bygone era hinder many groups from introducing new technologies. Some of these beloved, never-go-down Unix/COBOL/Fortran systems were built pre-2000 and were agile enough to be implemented for Y2K updates, but not for today’s agility. They restrict digital transformation initiatives and serve as an obstacle to affect time-to-market for newer services. These financial institutions are reluctant to upgrade these legacy systems as they run specific services and are proven to do their jobs as intended. Yet, they cannot take on the new services, applications, and architectures required for a modern environment. Besides, the skills to support these legacy systems are rare, and finding talent for these systems is costly and time-consuming.

 

Staffing for resilience and growth

Whether legacy systems, new technology, or innovative operational processes, the intense competition for skilled talent is a current reality. It isn’t easy to find the right technical expertise in this environment, much less to recruit them when you need them for a project. Top teams can upskill and supplement their talent on a project-by-project basis.3 Having the right expertise on hand when needed makes a big difference. Unlike the past, IT pros are now more mobile and transient. You may only secure the specifically skilled talent for a limited time. Starting a planned upgrade without the skilled pros to complete the plan can hinder morale. Worse, lose a key player needed to run a rip-n-replace project – yikes! Now more than ever, it is vital to have the skills on hand at the right time.

These challenges seem impossible—but they are not. Most organizations need supplemental expertise from vendors and partners skilled in these areas. Dealing with sudden security threats, surges in usage, storing regulated OLTP transactions, architecting new services, and finding timely skills to execute on planned upgrades, helps to have a trusted vendor with experience and skills in these areas.

 

You’re not in it alone! Cisco Business Critical Services for Financial Services IT

Added to these mounting pressures is the growing IT talent and skills gaps.  A recent study of 300 financial services industry executives found that 72% believe there is a moderate or significant skills gap threat and 75% feel there has been minimal or no progress in upskilling for digital or technical skills needs.

Cisco can help. We offer account-focused programs that benefit you by helping reduce operational costs and achieve faster time to market for new applications and solutions. Operating one of the largest global cybersecurity threat monitoring networks, we innovate our own products and services with compliance embedded. We train and certify skilled IT experts for all phases of the IT lifecycle and are ready to help you. Reach out to Cisco CX Business Critical Services or your Cisco partner representative.

See how Westpac, Australia’s oldest bank, improved agility, reduced costs, and increased visibility into network performance to better manage disruptions and risk.

 


 

References

1 FinTech Magazine, 2020

2 Thomson Reuters, 2021

3 Pluralsight, 2021

 

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