A woman walks across a bridge overlooking the financial business district in Singapore on August 11, 2020. – Singapore’s virus-hammered economy shrank almost 43 percent in the second quarter, in a sign that the country’s first recession in more than a decade was deeper than initially estimated, official data showed on August 11. (Photo by Roslan RAHMAN / AFP)

Singaporean capital market firms more reliant on MSPs

Managed service providers (MSPs) are enabling businesses to make full use of technologies today. With the cloud being an enabler for digital transformation, more businesses look to embrace the full potential of cloud services. However, managing them can be challenging, especially with a lack of skilled IT professionals.

Moving to the cloud

Fortunately, businesses can look to outsource their cloud management via managed service providers. Be it the manufacturing, financial, or even healthcare industry, the cloud enables greater efficiency in getting workloads completed.

From the use of machine learning and artificial intelligence to harness valuable insights from data to operating machinery, the Southeast Asian region, in particular, has been experiencing faster cloud adoption.

In the finance industry, capital market firms continue to search for new ways to create efficiencies and relying on powerful technology to accelerate their growth. As a result of the pandemic, many firms are shifting their priorities to the cloud, according to insights from the latest Readiness Survey by FIS.

In fact, over 8 in 10 Singaporean capital market firms plan to increase reliance on managed cloud services in the next 12 months. Managed cloud services are provided by MSPs to help businesses manage the services they intend to use on the cloud, be it public, private, or hybrid.

With remote work still being practiced in most countries in the region, 43% of firms are looking for greater support from their tech providers to improve the remote work infrastructure as well. This includes providing the right tech framework for their cloud transformation journey.

Managed service providers for cloud on the rise

According to Tara Winters, SVP, Managed Services, Capital Markets at FIS, Singaporean capital market firms will increase reliance on managed cloud services for activities such as risk management, regulatory reporting, and client reporting. She explained that the shift in demand for cloud adoption comes at a time of rapid digitalization for capital market firms as many are realizing that becoming cloud-enabled will ultimately increase agility, efficiency, manage risk, and secure competitiveness.

“Each cloud model has advantages. As our survey indicates, there is no ‘one-size-fits-all approach. As firms look to leverage the capabilities of the cloud, they need to take their regulatory, functional requirements, and processing cycles into consideration. This will help them decide the cloud offering and partner that is best suited to their needs,” said Tara.

Interestingly, the survey showed that the private cloud is the most in-demand compared to the public and hybrid cloud. With concerns of cybersecurity and data privacy on the rise, it’s not surprising why 95% of organizations opt for the private cloud. Singapore also has strict data regulatory and compliance rules on the use of data and storage, which is probably why most firms preferred to have the private cloud on-premises.

The financial industry in particular needs to take extra measures in protecting data which is why more than half of the firms surveyed are also looking to strengthen cyber and fraud risk defenses by investing in regulatory tech solutions.

At the same time, the private cloud enables them to customize the cloud platform based on their specific business workloads. However, with cloud computing services improving, some businesses are also considering a hybrid cloud framework whereby they can store their data on the private cloud on-premises and run workloads on the public cloud.

For cybersecurity though, most companies do not have the right skillsets to ensure their businesses and data are well secured and protected. Complicating this is that APAC currently does not have enough cybersecurity professionals. However, global tech giants such as AWS, Microsoft, and Cisco are partnering with regional organizations and higher learning institutions to help bridge the digital skills gap.

The report also stated that 70% of Singaporean insurers will increase their reliance on private cloud for regulatory reporting and 60% will increase their reliance on the private or hybrid cloud for digital payments. The pandemic has caused digital payments to gain traction not only in Singapore but the entire Southeast Asia region.

“As firms tackle transformation through the cloud, one thing remains clear – the scalability and resiliency offered by cloud are unmatched, and as the industry continues to evolve, managed service for cloud computing will form a critical part of every capital market firm’s future business and technology roadmap,” commented Tara.

Cloud adoption will only continue to increase as advancements in AI enable greater possibilities for organizations. Be it providing cloud or security services, managed service providers will continue to play a major role in the adoption of these technologies in the region.