Regulators urged to streamline guidelines on cloud-based data solutions for financial industry

Regulators urged to streamline guidelines on cloud-based data solutions
Angela Kyerematen-Jimoh, Regional, General Manager for IBM North, East and West Africa

With the rapid rate of digitalisation spurred on by the ongoing pandemic showing no signs of abating, and with it, the ensuing rise in volumes of sensitive data, the time is right for regulators to streamline guidelines on cloud-based data solutions, Regional, General Manager for IBM North, East and West Africa, Angela Kyerematen-Jimoh, has said.

According to her, intelligent, cloud-based, particularly hybrid variants and Artificial Intelligence (AI) capabilities will define the financial services landscape going forward, as such, there is the need for watchdogs to keep in step with the developments.

Hybrid cloud comprises two or more private, community, or public clouds that, while remaining unique, work together. It has gained traction owing to the desire for institutions to derive benefits from cloud computing, whilst maintain sensitive data on-premises, principally as a measure of security.

Speaking during an interaction with select media persons, where she stated that six major banks on the continent are turning to IBM for its hybrid cloud and AI solutions, she said: “We are currently presented with great opportunity for central banks to streamline and put out thee right regulation for banks. As we engage with different banks in the region, what we see is that they do not have clear guidance from the central banks as to how they adapt to the cloud, as such, it remains a gray area for many.”

Such a move would require the collaborative efforts of financial services regulators and data protection regulators alike, as cloud-based solutions involve the dispersal of data across servers located in various locations in the world, with the manner in which the cloud transcends national boundaries “creating potential dangers by moving data into, or allowing access to data from, countries with restrictive data privacy and protection laws.”

On his part, General Manager, IBM Cloud, Alan Peacock, whilst touting his outfit’s tailored solutions for financial services providers said the hybrid model allows for benefits including cost flexibility, scalability, market adaptability, masked complexity, contextual variability, and ecosystem connectivity.

He added that as banks become increasingly focused on cyber security controls like fraud and money laundering prevention, hybrid cloud solutions – currently a $1 trillion opportunity will continue to grow as it appears less than 25% of workloads have uploaded into the cloud, globally.

“There is a material opportunity for flexibility and to gain capabilities you won’t be able to do on-premise. We see prevailing data residence laws in various countries across the world, meaning that your data cannot leave that country or in some cases, the premises. That for us is a very clear opportunity, as it allows clients to benefit from cloud-based solutions whilst keeping their capabilities on-site; data remains on-premises but clients benefit from cloud technology,” he said, adding that IBM’s hybrid cloud business topped $27 billion for the first half of 2021.

Group Executive responsible for Operations and Technology at Ecobank – one of the banks tapping into IBM’s solutions, Dr. Tomisin Fashina said that whilst regulators grapple to reconcile the pros and cons of increased cloud-based data solutions, he is encouraged by the forward-thinking approach of many central banks. He suggested that in the interim, Ecobank will continue to maintain its private data centers in Accra and Lagos, whilst utilling IBM’s services.

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