Cloud Computing is the use of computer resources, both hardware and software, that are delivered as a service over a network. The name is derived from the symbol which is an abstraction for the complex infrastructure it contains in system diagrams. It is the delivery of computing as a service rather than as a product, and it is done so in real time using grid of inter-connected computers. It entrusts remote services with a user’s data, software and computation. Users pay for the amount of service they use in a pay-as-you-go model, just like you pay for electricity or water. Various types of services are provided in cloud computing such as Infrastructure-as-a-service, Software-as-a-service, Networkas- a-service, Storage-as-a-service, Data-as-a-service, Platform-as-a-service.
Banks can use lot of these services, especially, Infrastructure-as-a-service, Network-as-a-service, Storage-as-service and Data-as-a-service. Critical to the banks is the speed to launch new products, promotions and services in the market. The cloud enables a bank to increase capacity, without necessarily having to invest in additional infrastructure, while cutting down the time and effort in purchasing such infrastructure and effect expenditure transition from capital to operational.
Banks can reallocate IT operations costs away from hardware/software spending and also personnel expenses, towards meeting other IT goals. Also with applications hosted centrally, updates can be released without the need for users to install new software.
Security is a key concern among potential users and the cloud model is evolving accordingly. Once the security concern gets addressed it will play a key role in banking sector.