Financial services firms are increasingly seeking ways of leveraging AI to address business needs including complying with increasingly onerous regulatory requirements, and seizing new business opportunities such as extending product ranges and entering new markets. Only open hybrid cloud environments can give firms the scalability, agility and flexibility that is necessary to drive successful AI outcomes. This article addresses how open hybrid clouds can build resilience and drive digital transformation in the financial services sector. It also describes some of the main benefits of open hybrid clouds for financial services firms, including the enablement of mission critical AI services. Red Hat’s OpenShift development environment is widely used to underpin open hybrid cloud strategies for financial services firms giving them a competitive advantage and enabling mission critical AI services.

Open Hybrid Clouds Needed for Mission Critical AI Services in the Financial Services Sector

Financial services firms are increasingly deploying hybrid cloud architectures to support their operations. A hybrid cloud can be defined as any combination of public cloud, hosting and private data centre resources that can be orchestrated and integrated to run an application.

Hybrid cloud platforms need to be designed in a way that allows developers and business teams to natively integrate new technologies such as AI into business applications, which can subsequently be deployed across any environment.  These clouds need to allow financial services firms to migrate from legacy architectures which make it difficult to integrate, orchestrate, migrate and manage workloads across all environments. This is not always easy.

Open hybrid clouds are typically built on open-source platforms and enable flexibility, portability, interoperability and control that are needed to deploy and manage workloads on premise as well as across any public cloud.

In order to remain competitive, particularly against disruptive fintechs, financial services firms need to introduce agility, flexibility and scalability into their businesses. This requires a change in their approach to software development, particularly with respect to AI.

Modern application development requires functionality to come from building blocks of code and microservices rather than from traditional rigid monolithic applications. Modern applications can be quickly and easily assembled, tested, deployed, and updated. 

Open hybrid clouds offer a range benefits for financial services that wish to build AI services, including:

• Scalability. Many financial services firms still operate banking applications on premises, making resource provisioning for AI rigid and time consuming.  An open hybrid cloud allows  financial services firms to expand their computing capacity and gives them the ability to drive data intensive AI outcomes. 
• Edge Computing. As many financial services firms start adopting IOT and edge applications, the centre of gravity of the data starts moving to the edge, driving implementation of AI right at the edge to all the way the back on public clouds. 
• The highest levels of availability and performance. Mission critical digital services are now dependent on AI services such as real-time AI to prevent payment fraud and verify KYC information with third party intelligence databases. Hybrid cloud load balancers play a critical role in high availability by providing redundancy in the event of a failure. An open hybrid cloud platform allows different clouds to act as backup for each other. Visibility and analytics across hybrid cloud environments enable end to end monitoring and management and ultimately enhanced performance management.
• An agile approach to application development allows financial services firms to quickly roll out and scale resource-intensive AI services by leveraging the cloud. Applications that are highly dependent on legacy platforms can still be updated and deployed faster by moving existing monolithic applications to a container-based platform built on microservices.
• Automating IT accelerates the delivery of cloud-native applications and eliminates manual IT tasks. Financial services companies struggle to access the skills required to fully leverage open hybrid clouds. IT management and automation tools can create processes and rules which can reduce dependence on labour and speed up time to market for new applications
• Portability using containers. Containers can enable financial services firms to easily migrate workloads between different environments. Open hybrid clouds provide a consistent fabric for deploying containers. This offers multiple benefits including more accurate and faster risk analysis and fraud detection, across the enterprise while reducing risks related to dependence on single cloud providers.

Hybrid Cloud Application Development Platforms Built on Kubernetes Drive Transformational AI Services

Fintechs already use AI widely and most are data-driven businesses. They are eroding the market position of traditional financial services firms. Within traditional financial services firms, there is a critical need to bring people, processes and platforms together. This approach can expedite AI workflows and offer scalability and agility that is typically not present in more established firms. Hybrid cloud application development platforms built on Kubernetes, such as RedHat Openshift, are ideal for this purpose.

Financial services firms increasingly use AI to enhance customer experience, drive new revenue streams, streamline processes and operations and detect and respond to fraud.  AI can also be used to ensure compliance,

Effective AI solutions can provide competitive advantages to financial services firms and enable them to compete with fintechs. For example, they can upsell more effectively and offer more customized experiences. Fraud is becoming increasingly difficult to detect especially when firms continue to use legacy technology. A cloud-native approach across all assets can enable security to be baked into code to enforce policy and make it easier to detect threats including anomalous, potentially fraudulent activity. 

Cloud-native AI development platforms allow financial services firms to create controls which are necessary to repeat, scale and trust AI outcomes across the organisation. These platforms are also essential to orchestrate a typically complex development lifecycle. Open hybrid cloud environments can enable this AI-driven transformation by using open standards to allow applications and data to consistently move from one environment to another. 

Red Hat Openshift is a Kubernetes container platform built for an open hybrid cloud strategy. It can underpin hybrid clouds in the financial services sector and enable the provision of resilient mission critical AI solutions. It gives developers a common application environment across all cloud assets allowing them to rapidly develop, orchestrate and run their applications. This consistency across environments can allow financial services firms to deliver automated IT infrastructure. Commonly, refactoring of applications to be cloud-ready is a cumbersome and time consuming task. An agile approach based on Openshift can allow financial services forms to quickly roll out and scale resource-intensive AI services. The environment meets the critical need of AI services for cloud scalability, rapid incident response and performance management.