How AI Agents will Drive Us from Automation to Autonomy
Sagar Nangare
Neet Bhagat
October 3, 2024
7 Minutes read
Cloud Transformation in Retail and Corporate Banking
The financial sector is undergoing a profound transformation, with cloud technologies becoming a driving force for innovation in retail and corporate banking. As traditional banks face increasing competition from fintechs and challenger banks, the agility, scalability, and cost-efficiency provided by cloud solutions are crucial for staying competitive in 2025 and beyond.
Cloud platforms like AWS, Azure, and Google Cloud enable banks to modernize their infrastructure, deliver personalized customer experiences, and scale rapidly, ensuring high availability and resilience. This blog explores how the cloud is transforming retail and corporate banking, along with real-world use cases to illustrate its impact.
Cloud Transformation in Retail Banking
Modernizing Core Banking Systems
Banks are modernizing their operations by transitioning from legacy monolithic systems to cloud-native architectures. This transition allows banks to offer new services faster while ensuring higher scalability and availability.
Business Use Case: A regional bank with outdated legacy systems could only update its core banking services once a year due to the complexity of its infrastructure. By moving to a cloud-native, microservices-based architecture using Azure Kubernetes Service (AKS), the bank reduced the time for system upgrades from 12 months to 3 weeks. This transformation enabled faster rollouts of digital services like mobile banking and credit processing.
Technical Reference: The bank leveraged Spring Boot for building microservices on Azure Kubernetes Service (AKS), improving scalability and reducing operational overhead.
Cloud-Based Digital Banking Platforms
Retail customers increasingly demand seamless digital banking experiences. Cloud platforms allow banks to offer 24/7 digital banking services personalized to customer needs.
Business Use Case: A retail bank launched a fully digital banking app to compete with fintech startups. By leveraging AWS Amplify for rapid development and deployment, the bank was able to launch a feature-rich mobile banking app in 6 months, increasing digital engagement by 40%. Customers could access their accounts, apply for loans, and make payments instantly.
Technical Reference: The app used AWS Amplify for backend integration with cloud-based APIs and Amazon RDS for secure and scalable data storage.
Open Banking APIs and Ecosystems
Open banking regulations like PSD2 require banks to expose APIs to third-party providers, enabling innovation through partnerships with fintechs.
Business Use Case: A European bank implemented an open banking platform using Azure API Management, allowing fintech partners to develop new financial products. This led to the launch of a personal finance management app that integrated customer banking data with investment recommendations. The bank’s new ecosystem increased cross-selling opportunities by 25%.
Technical Reference: Using Azure API Management, the bank ensured secure API exposure while complying with regulatory requirements for data protection.
Automation and RPA in Retail Banking
RPA for Reducing Manual Steps
Routine processes such as customer onboarding, loan processing, and compliance checks can be automated using Robotic Process Automation (RPA), reducing operational costs and errors.
Business Use Case: A retail bank reduced its loan approval time from 5 days to 12 hours by integrating UiPath RPA bots with AWS Lambda for automated document verification and credit scoring. This automation cut operational costs by 30% and allowed staff to focus on higher-value tasks like customer service and relationship management.
Technical Reference: AWS Lambda executed serverless functions for document processing, while UiPath handled RPA workflows for credit scoring and compliance checks.
Cloud-Based RPA Solutions
Cloud-hosted RPA solutions can scale automation across multiple locations, offering flexibility and faster processing.
Business Use Case: A large retail bank with branches across multiple regions deployed RPA bots on Azure Virtual Machines to automate KYC (Know Your Customer) processes. This helped the bank handle a surge in customer applications during a marketing campaign, increasing onboarding capacity by 50%.
Technical Reference: Hosting RPA bots on Azure Virtual Machines allowed the bank to scale the automation of KYC checks in real-time, reducing manual intervention and improving customer onboarding speed.
Cloud in Corporate Banking: Real-Time Services and Innovation
Real-Time Payments & Cash Management
Corporate clients require robust infrastructures for handling high-volume, real-time payments and cash management. Cloud platforms provide the elasticity to scale these services on demand.
Business Use Case: A global corporate bank enhanced its real-time payment processing system using AWS Lambda, enabling real-time international payments for its enterprise customers. The new system could scale automatically during peak times, ensuring zero downtime and reducing processing time from 48 hours to under 1 hour.
Technical Reference: The bank utilized AWS Lambda for serverless processing and Amazon API Gateway to handle real-time API calls for payment validation and processing.
AI-Driven Cash Flow Forecasting
Corporate banking relies on accurate cash flow forecasting to manage liquidity and risk. AI models hosted on the cloud can provide real-time insights, helping clients make informed decisions.
Business Use Case: A corporate bank introduced AI-driven cash flow forecasting using Azure Cognitive Services to provide real-time predictions of cash positions for its large corporate clients. This improved forecasting accuracy by 20%, reducing liquidity risk and enabling better financial planning.
Technical Reference: The bank’s AI models were deployed using Azure Machine Learning, allowing seamless integration with corporate banking dashboards for real-time updates.
ACloud and AI Integration in Banking
AI-Powered Personalized Banking
Fraud detection is a critical area where AI can add value by identifying suspicious activities in real-time and mitigating risks before they escalate.
Business Use Case: A bank reduced fraudulent transactions by 40% by implementing an AI-based fraud detection system using Amazon Fraud Detector. This system flagged suspicious transactions in real-time, allowing the fraud team to take preventive actions before the transactions were completed.
Technical Reference: Amazon Fraud Detector and AWS Lambda were used to analyze transaction patterns in real-time, flagging potential fraud cases for further investigation.
AI for Fraud Detection and Risk Management
Fraud detection is a critical area where AI can add value by identifying suspicious activities in real-time and mitigating risks before they escalate.
Business Use Case: A bank reduced fraudulent transactions by 40% by implementing an AI-based fraud detection system using Amazon Fraud Detector. This system flagged suspicious transactions in real-time, allowing the fraud team to take preventive actions before the transactions were completed.
Technical Reference: Amazon Fraud Detector and AWS Lambda were used to analyze transaction patterns in real-time, flagging potential fraud cases for further investigation.
Conclusion: Bringing Agility and Innovation to Retail and Corporate Banking
Cloud computing is fundamentally transforming retail and corporate banking by enabling agility, scalability, and innovative service delivery. From modernizing core banking systems to adopting AI and automation for personalized experiences and risk management, cloud platforms like AWS, Azure, and Google Cloud offer powerful tools for innovation. By integrating cloud-native solutions with AI and RPA, banks can reduce costs, enhance customer experiences, and stay ahead in a competitive market.
ACL Digital has proven credentials in pivoting global Banking and Financial services organizations into the future by providing superior customer experiences, redefining business models, and delivering improved operational efficiency. Our next-generation digital banking solution empowers financial institutions to enhance their digital relationships with customers. By providing robust digital touchpoints and driving continuous business value through data-driven transformations, we help you stay ahead in the evolving landscape. To learn more, connect with our experts at business@acldigital.com.
