The banking industry's digital transformation lies in an effective combination of open APIs and Enterprise Architecture. Let us see how.
The banking industry, as with many other industries, is on a path of digital transformation. But, what separates the banking industry is the complex nature of carrying out the said transformation. This complexity results from the highly regulated nature of the industry and the existence of legacy and monolithic architectures. Implementing such a mammoth task and enabling digital transformation lies in an effective combination of open Application Programming Interfaces (APIs) and Enterprise Architecture (EA). Let us see how.
The Role of Open APIs in the Banking Industry
The lack of open APIs can significantly impact the banking industry's (and of specific banks within) capability to manage their EA. Many banks now rely on open APIs to foster external collaboration.
The three major types of APIs used by the banking industry are internal and system APIs (aiding in the rapid development of microservices based on legacy systems), public APIs (layer connecting back-end for external services), and the front-end layer public APIs (connecting to third-party services and applications). An efficient EA can show how data moves from the legacy back-end to the services at the front end with the help of APIs.
Modern EA Strategy and Digital Transformation
Many core systems within the banking industry have been run using legacy systems and older programming languages like COBOL for decades. Retiring such mainframe systems and removing the dependencies are not easy tasks, as they could create downtimes for customers of the respective banks. From a business perspective, this is not an acceptable situation. Newer fintech companies do not face these challenges since their services are built on more adaptable and comparatively modern frameworks. As mentioned earlier, the banking industry also has to deal with stricter data regulations and must go through significant planning and execution steps in case of any alterations.
EA can help the banking industry see the full picture of their current IT infrastructure, including dependencies. A wholesome view with EA will enable banks to determine and execute necessary drivers and actions. Cloud computing is an example of a desirable driver here. In a heavily guarded environment such as the banking industry, not all IT systems can be suited or moved to the cloud. Specialized enterprise architects determine what to include in futuristic steps, what to avoid, and define best practices forward.
Cloud Adoption in the Banking Industry
EA can determine where and how the cloud can help define the relationships between the varied business components for the banking industry. Further along the line, an experienced cloud provider can help enterprises with the adoption process. At VEXXHOST, our cloud services are based on OpenStack, making the environments free from licensing fees or vendor lockins. For many of our clients, private clouds are the preferred choice because of their highly scalable and secure nature.
Speaking of private clouds, you can now run on a fully agile and customized cloud from VEXXHOST, with no licensing fees and smooth 2-week migration. In fact, we're ready to put our money where our mouth is. We're so confident in being able to save you at least 20% or more on your current cloud infrastructure expenditure that if proven wrong- we'll give you $1,000 credit to our public cloud.
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