Only 28 percent of American financial companies have an existing cloud strategy, according to a Cloud Security Alliance report. Released on Thursday, the Cloud Adoptions Practices & Priorities Survey Report shows that while 61 percent of financial institutions are currently developing an organizational cloud strategy, the majority, especially in the US, do not yet have one in place.
In the EMEA and APAC regions 35 and 41 percent of financial companies, respectively, have a plan in place. While cloud adoption is growing, the planning and implementation of cloud strategies are slowed by concerns about controls and security, which are driven by regulatory requirements.
The report was compiled from the results of a survey conducted by the CSA Financial Services Working Group. More than 100 participants from financial companies of various sizes from around the world responded to the survey.
Increased transparency and better auditing controls are the top concern for 80 percent of financial institutions moving to the cloud, followed by better data encryption for 57 percent.
“The responses overall showed a very active market for cloud services in the financial services sector,” said Dr. Chenxi Wang, Vice President, Cloud Security and Strategy at CipherCloud, which sponsored the report. “Cloud has made solid in-roads in this industry with many firms looking to harnessing the power of cloud. There’s plenty of room for growth, particularly for providers who can fill the void for the auditing and data protection controls that are at the top of respondents’ cloud wish list.”
Asked why they are moving to the cloud, 68 percent of respondents indicated the need for flexible infrastructure capacity, while 63 percent said reduced time for provisioning. CRM (46 percent), application development (45 percent), and email (41 percent) are the top cloud services for financials.
The report says that as cloud computing becomes more prevalent, hybrid strategies are becoming an industry norm. However, the path there is inconsistent, as the report calls adoption “ad hoc,” and points out that the degree of digital customer interaction significantly influences company plans.
Bank hacks and government urging have set up an expected spike in spending by financial institutions on data security. The report could also indicate a potential windfall for companies providing control and visibility to multi-cloud environments, such as ScienceLogic, which closed a $43 million funding round in February.