Banks Take Steps to Reduce Potential Cloud Computing Risks, Google Survey Shows

Regulators are worried that reliance by many banks on the same providers could create systemic risk.

By Reuters | Updated: 13 August 2021 11:33 IST

Banks Take Steps to Reduce Potential Cloud Computing Risks, Google Survey Shows

Photo Credit: Google

The bulk of the companies are also considering adopting a multicloud strategy, the Google survey said

Highlights

Reliance by many banks on the same providers could create systemic risk
The survey included 1,300 leaders in financial services
The Bank of England and the Bank of France have expressed concerns

Banks are taking steps to mitigate risks from their increasing use of external cloud computing services, a survey by Harris Poll and Google Cloud said on Thursday.

The Bank of England and the Bank of France have expressed concerns about a lack of transparency in how banks rely on a "concentrated" number of outside cloud computing providers like Google, Microsoft, and Amazon which are beyond the arm of the regulators.

Regulators are worried that reliance by many banks on the same providers could create systemic risk if one of the cloud companies were to go down.

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The survey of 1,300 leaders in financial services from the United States, Canada, France, Germany, Britain, Hong Kong, Japan, Singapore, and Australia showed that 83 percent were using the cloud as part of their primary computing infrastructure.

The bulk of the companies are also considering adopting a multicloud strategy, the survey said, which would allow a bank to switch to an alternative provider if there is an outage to avoid an interruption of services for customers.

"Based on the Harris survey, it is clear that financial institutions are taking actions to solve concentration or vendor lock-in concerns with 88 percent of respondents not currently using a multicloud strategy considering doing so in the next 12 months," Adrian Poole, director for financial services in Britain and Ireland for Google Cloud, said.

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