Not unlike most technology, cloud-based digital banking solutions can vary. But it’s those differences that can either enable growth or stifle it in its tracks.
It’s no surprise that cloud-based banking solutions are all the rage these days; their benefits are difficult to ignore. From flexibility, scalability, and cost-effectiveness, cloud-based solutions offer banks and credit unions a way to compete with large, global financial institutions on any number of levels.
“Cloud-based” is really a catch-all for any solution utilizing a cloud provider to host and maintain a digital banking platform. It’s like saying, “I’d like to buy a computer.” Sure, all computers enable you to perform functions and tasks, but do you want a laptop or a desktop? Do you want a basic one with limited features or one with all the bells and whistles?
You get the point. Not all computers are created equally, and neither are cloud-based digital banking platforms.
Many vendors offering cloud-based banking solutions blur the lines on what that entails beyond hosting your platform in the cloud. In other words, they’re selling you a “computer”—one that can do the tasks that you need. But what they’re not telling you is the make, model, and specifics of just what you’re getting. It’s high time you know precisely what kind of computer you’ll get. Or, what “cloud-based” really means in application, based on the type of technology stack you choose.
A computer with boot camp: the hybrid-cloud platform.
A hybrid cloud solution combines the use of both public and private cloud environments. In a hybrid cloud solution, you deploy some of the application components or workloads on a public cloud environment. Other elements move to a private cloud environment that is typically located on-premises or in a data center. A secure network connects the public and private cloud environments, enabling the hybrid solution to benefit from both cloud models.
There are several reasons why organizations may choose to adopt a hybrid cloud solution. For example, existing legacy applications may not easily migrate to the public cloud. Or there are data residency or compliance requirements that mandate using a private cloud. A hybrid cloud solution can provide organizations with the flexibility that they need to find when they need it. It gives you options around key considerations such as cost, performance, security, and compliance.
However, using a hybrid cloud solution poses some challenges and considerations. For instance, managing and integrating applications across multiple cloud environments can be complex and require specialized skills and tools. Transferring data between public and private clouds creates other security and compliance risks. Also, ensuring consistent data protection and governance policies can be challenging. Finally, managing the costs and optimizing the performance of a hybrid cloud solution can also be complex. This requires careful planning and monitoring.
Like a hybrid-cloud solution that combines both on-premise and cloud infrastructure, a computer that can run both Mac OS and Windows can connect two different operating systems. Both examples offer the flexibility to run different applications and workloads based on the user’s specific needs. However, running two operating systems on the same computer can cause performance and compatibility issues. The same can be said for using a hybrid-cloud solution can also present data integration, security, and compliance challenges.
An iMac: the cloud-adapted solution.
A cloud-adapted solution is a digital platform that you modify or “adapt” to run in the cloud. Sometimes, people refer to this type of solution as a “lift and shift” solution because they lift the application from the on-premises environment and shift it to the cloud environment without making significant architectural changes.
In a cloud-adapted solution, you typically deploy the application in a virtual machine or container in the cloud environment. It may use cloud services such as storage, networking, and databases. You can modify the application to take advantage of cloud services, but you must keep the core architecture and design essentially unchanged.
Cloud-adapted solutions can be a good option for organizations that want to move their applications to the cloud quickly and with minimal disruption to their existing architecture. However, this approach may not offer the most efficient or cost-effective solution over the long term. Often, these applications may not enable cloud scalability, resilience, and efficiency. Additionally, cloud-adapted solutions may require more maintenance and management than cloud-native solutions, as they may not have the same degree of automation and self-healing capabilities.
Just as an iMac computer can be adapted to work with cloud services through the installation of additional software, or through the use of cloud-based apps, a cloud-adapted solution is a traditional on-premise solution that has been adapted to work with cloud infrastructure and services. While both the Mac computer and cloud-adapted solutions can work with cloud services, they do not explicitly take full advantage of cloud-native technologies and architectures. They may not offer the same scalability, efficiency, and flexibility as a cloud-native platform.
A MacBook Pro: the cloud-native solution.
Cloud-native platforms provide significant benefits compared to traditional on-premises and cloud-adapted solutions. First and foremost, cloud-native platforms are built specifically for the cloud environment, enabling them to take full advantage of cloud-native technologies and architectures, such as containerization and microservices. This makes them highly scalable, flexible, and adaptable, with the ability to quickly and easily allocate resources based on demand.
Another critical benefit of cloud-native platforms is their ability to operate efficiently and cost-effectively. Typically, they exhibit high automation, possess self-healing capabilities, and streamline management processes, demanding less maintenance and overhead management than traditional solutions. This can help reduce costs, improve operational efficiency, and enable organizations to focus on innovation and value-added activities.
Cloud-native platforms offer improved resilience and reliability, with built-in redundancy and failover mechanisms that ensure high availability and business continuity. They can also help improve security with robust encryption and authentication mechanisms that protect data and applications from unauthorized access or attacks.
Finally, cloud-native platforms are highly portable and can operate across multiple cloud environments, making them an ideal choice for organizations looking to adopt a multi-cloud or hybrid cloud strategy. This can provide organizations with the flexibility to choose the most appropriate cloud environment for each application or workload, based on factors such as performance, cost, and compliance requirements. Overall, cloud-native platforms offer a powerful and flexible foundation for modern digital banking operations, enabling organizations to deliver innovative and customer-centric services with speed, agility, and efficiency.
Like the MacBook Pro is designed from the ground up to work seamlessly with Apple’s operating system and ecosystem, cloud-native platforms work effortlessly with cloud infrastructure and services, taking full advantage of the latest technologies and architectures. Both the MacBook Pro and cloud-native platforms are highly optimized, efficient, and adaptable, with the ability to deliver superior performance and user experience.
A solution that was born in the cloud.
Are you ready for a digital banking platform that was designed specifically for the cloud? Look no further. Lumin Digital’s platform is 100% cloud-native, while other platforms partially adapt or retrofit for the cloud. We’re the only provider to standardize weekly updates with zero downtime, reducing the time your team spends preparing for and dealing with service interruptions, and increasing the speed at which we help you bring the next great innovation to your customers. Contact us to learn more about how we can illuminate your success.