As the world is constantly on the work and socialise using their homes, we have never been so heavily dependent on functioning data centres. The banking industry continues to be unknowingly preparing for the current scenario we discover inside us for a long time, using the rise of digital-first banking.
The latest Accenture Digital Banking Tracker showed digital lenders gained over six million new clients in the second half of 2022, with the global total reaching a staggering 19.Six million. This rise in adoption is only set to improve as all areas of society are going to improve their digital footprint.
As adoption continues to grow, the technology behind open banking develops, and interest in mobile services increases. The data centre is central to business continuity for banking organisations.
No room for failure
In our digital-first existence, driving adoption for digital banking tools is not a pressing issue. However, making certain these offerings are underpinned by long term profitability remains challenging.
We've already seen digital banks suffering a variety of IT challenges which originate from their chosen infrastructure decisions. Pioneering fintech start-up, Monzo, suffered at the end of 2022 as users lost visibility of their savings after an influx of customers requesting to get their Christmas wages, with the “Get Paid Early” feature. It isn't just start-ups feeling the strain though. On New Year's Day, a large number of Lloyds Bank, Halifax and Bank of Scotland customers were not able use online banking services due to an IT outage. Outages such as these cannot become commonplace in a world where a lot of depend on these types of services as standard.
These outages can be the result of a large number of different reasons, but looking for ways to lessen the number of pain-points will deliver huge savings to banks. For instance, Monzo reportedly spends 67% of all account costs on customer service. Having a more resilient back end however, these costs could be reduced as customers have few reasons to contact customer services.The information centre then, is important to providing a quality customer experience, and then any downtime will have serious consequences.
No room for inefficiency
There are loads of reasons data centres can experience downtime, but two of the most prominent are human error and failures. As established, downtime for banks has a huge impact on its customers, reputation and profits. In an independent report, commissioned by Future Facilities, it was found that businesses are losing over lb120,000 each year to downtime typically, a figure that's growing and certain a lot more in the financial services sector.
To rectify this, banks must turn to technology which will help data centres run more efficiently and cuts down on the likelihood of downtime. The latest trend supporting efficiency in the data centre is the introduction from the digital twin.
The digital twin is a full virtual model of a real object which may be modified to replicate the same real-world impacts around all at the mouse click. Within the data centre environment, the digital twin is enabling providers to understand more about different setups and layouts for his or her estate. Providers can then test the outcome of any adjustments on the performance from the data centre.
Data centre performance is really a delicate balance between capacity, efficiency and compliance. Using a data centre digital twin allows operators to find the optimal good balance to save energy and maximise performance. Once a setup has been found that achieves the desired results, it may then be implemented within the physical data centre itself, all safe in the knowledge it has recently been rigorously tested in the digital twin. This method saves money both in designing and operating a data centre, and mitigates the risk of unplanned changes, improving the overall toughness for a business's infrastructure.
Decision-makers need to actively look for data centre providers designed to use this approach for their hosted services and then use it themselves within their owned locations.
Room for change
The knock-on effect of reducing downtime means not just happy customers, but more time to focus on creating new features too. During a time where businesses and consumers alike are experiencing to sit in the brand new way we live, banks need the capability to develop new functionality quickly.
As banks shift service offerings, they are at risk of stretching their infrastructure in unforeseen ways, as Monzo did using its aforementioned “Get Paid Early” feature. Our research discovered that 3 times as many businesses using a digital twin hadn't seen an outage inside a 12 month period, compared to those who didn't use the technology. With its capability to save your time and reduce outages, it is no surprise that more than two-thirds of companies expect to have a digital twin in position over the following 12 months.