Financial institutions across key markets in Asia/Pacific namely Singapore, Malaysia, China, India, Australia, and New Zealand are taking measured approach to cloud computing, as the industry awaits further clarity on cloud computing regulations and better articulation of business benefits by IT vendors, according to a report by IDC Financial Insights.
Nearly 45% of financial institutions across key markets in Asia/Pacific namely Singapore, Malaysia, China, India, Australia, and New Zealand have adopted some form of cloud computing services and are waiting for tipping point, according to a report.
IDC Asia/Pacific associate consulting and research director Michael Araneta said the financial services industry, typically an early adopter of technology, has been uncharacteristically slow to take on cloud.
"There is still no wide-scale adoption of the technology, despite considerable resources allocated by vendors to ensure that their offerings scale up and become more mature," Michael said.
The report, Perspective: A Slow Ascent Toward the Cloud for Asia/Pacific Financial Services, looked at the cloud computing adoption plans of banks and insurers across major markets in Asia/Pacific.
IDC noted the industry mostly preferred manageable private cloud implementations, and usually for non-mission critical areas such as IT Management, server capacity, and storage, though regulation appears to be a major hurdle for widespread adoption of cloud computing in the industry.
"Our regulators have been very vocal about their concerns regarding anything cloud, and the stringent guidelines that they have set for financial institutions to abide by have to some extent, negated the supposed advantages of lower cost, and ease and speed of deployment of the technology," added Michael.
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For greater cloud adoption, clarity on regulations concerning cloud computing is required, which is not the current case.
According to the survey, 62.5% of the respondents either stated that regulations have become less clear, or that there has been no change to their understanding of what is or is not allowed by regulators, though the industry expects developments in regulatory policies in the next two years, facilitating the uptake of Cloud.
About 51.7% of the respondents expect that regulations will either "slightly more open" or "significantly more open" to cloud computing in the next two years.
Further, 66.1% of the respondents regard cloud computing primarily as an IT issue, without much consideration of the business-related benefits including the ability to regionalize more quickly, deploy capabilities more efficiently, or lower cost-to-serve numbers.
