Microsoft commissioned Forrester study titled “Ensuring Agility And Trust In A Rapidly Changing Business Environment” showed that financial services institutions (FSIs) across the Asia Pacific region are under pressure to increase agility, improve efficiency, and embrace digital transformation, but many organizations in the sector, especially in Malaysia – still lack understanding of how they can navigate regulatory and logistical processes.
As per the study, the Malaysian FSI sector is slow to adopt cloud technologies and wary of embracing digital transformation, with a ‘wait and see’ attitude for most FSIs.
Despite a strong interest in the technology, the pace of cloud adoption in Malaysia has been slowed by common misconceptions that there are regulatory barriers on the use of public cloud services.
One key finding from the study is that leading FSIs in the region are using regulations to help steer public cloud initiatives, and not as an excuse to stop them.
The better a firm’s understanding of regulations, the more likely it is to embrace public cloud services. In most instances, these initiatives are directly tied to customer-facing, digital banking capabilities like new customer acquisition and on-boarding.
Other highlights from the study include:
- In both mature and high-growth markets, firms interviewed for this study illustrated a lack of regulatory knowledge, citing perceived restrictions to cloud adoption/usage that are not actually present in the regulations.
- Engaging and interacting with financial regulators has become crucial. FSIs that reach out to regulators more proactively can address potential compliance issues earlier in the process are leading the sector in digital transformation.
- Cloud service providers are viewed as an essential part of the banking ecosystem in most Asia Pacific markets, and are expected to actively engage regulators to help shape their cloud delivery models and practices.
“Cloud is increasingly seen as an enabler of the organization’s journey to digital transformation. But it is important to realize that a cloud strategy will only be successful if there is a clear understanding of applicable regulations. As organizations’ understanding of regulations and of how and when to engage regulators increases, so too does their ability to successfully adopt competitive cloud solutions,” – Fred Giron, Analyst, Forrester Researc.
The study was conducted over a 3-month period, and involved in-depth interviews with 34 senior IT decision-makers in the Asia Pacific financial services sector from nine countries: Australia, Hong Kong, Korea, Malaysia, New Zealand, Japan, Indonesia, Singapore and the Philippines.
