How Cloud Computing is helping FinTech Firms in being GloballyCompliant:
One of my colleagues who is a big fan of #cashless and #digitization asked me while packing: can I pay with Amazon Pay during my visit to Germany? You should be too, they are active in Germany. But your account is in INR and may need to be changed to EURO? So your next question was: Fintech companies in one country, how do they manage compliance in countries?
Although I wasn’t sure and I assured him an answer before landing, I started researching it, and the result is this blog post –
Are #Compliance standards the same for all companies that handle money?
Really! All companies engaged in payments and financial matters must comply with PCI [Payment Card Industry] or ISO [International Organization for Standardization] standards. While PCI is mandatory for the plastic card issuer, ISO is voluntary.
What are the specific standards that financial institutions follow?
PCI and ISO have a set of standards that companies must adhere to when it comes to managing information security. Especially for financial matters, PCI DSS, ISO 27001, and ISO 20022 are accepted and followed. While the goal is the same, the method differs in how customer data is secured and managed. Both require regular audits and verifications to meet standards. A major problem is that you can use PCI DSS as part of ISO 27001 compliance. Let’s take a closer look at the specific compliance standards –
We now know the patterns different entities follow depending on whether they store customer data or only use it for processing with a 3rd party API or need it for online transactions. But how are these adherents tracked in different countries? Or traditional banks had to follow a set of rules and compliance, while fintech companies evolve to take on clients around the world, even the compliance methods have to meet today’s requirements.
Let’s take an example of digital payments: In India, Cashless payments grew by 22% in 2016, but have we seen this growth? Compliance standards should be used automatically by using technology to meet the needs of modern customers. One of the technologies that Fintech would like to help with is Cloud Computing! Thanks to cloud computing, payment banks, financial institutions, and NBFCs are broadening their horizons and going global!
How do FinTech companies use RegTech with cloud computing?
RegTech [or a merger of regulation + technology] is the new buzzword for meeting regulatory requirements and includes cool features like:
Seamless integration with technologies such as Analytics, Big Data, etc.
Many of RegTech’s companies, such as FundApps in London or Vizor, have taken cloud solutions into account in their design. Using cloud computing loads these solutions with benefits such as remote maintenance, cost-effective, flexible data sharing, secure and scalable.
A cloud architecture consists of virtual routers and firewalls; multi-redundant environments can help create an improved configuration for disaster recovery scenarios.
Cloud computing can help automate the audit and control process so that Fintech engineers can work on product improvement.
Cloud configuration helps provide global solutions that provide 24*7*365 access to data.
With cloud computing, you can maintain performance even during peak hours or in months-long queues by providing access to powerful servers and data storage.
The cloud helps to make the production cycle continuous, reducing the time-to-marketing of a product/solution.
Most solutions in the cloud are now one-click solutions that are also available via a smartphone.
Financial institutions and regulation were two sides of the same coin, with banks moving to other entities, even regulation has to take risks. Technologies help maintain compliance and protect and protect customer data.