How Financial Firms Should Evaluate Cloud File Solutions.
Because of the vast quantity of information that financial institutions manage, and because of the huge consequences associated with a security breach or data loss, Cloud storage offers tremendous benefits. But high profile breaches in Cloud storage systems like Dropbox and Google Drive create an instant recipe for skepticism about “the Cloud.”
Let’s explore both the security concerns and the significant value Cloud storage can offer banks, investment firms, insurance agencies, and other financial services companies in New Jersey.
For financial companies, even more so than other industries, the first concern with Cloud storage is always security. We’re talking bank accounts, tax returns, insurance documents—highly sensitive data that cannot be exposed to a security breach.
Because the ramifications of a security lapse are so severe, the required level of security for storing customers’ financial information is very high. The good news is, Cloud storage services recognize their business depends on air-tight security. According to DataBreachToday.com, in a whitepaper interview with Oracle executive Troy Kitch, Cloud security is moving “from a concern to a selling point.”
In addition, the regulatory requirements are numerous and extensive, with mandates laid out by the Gramm-Leach-Bliley Act (GLBA), the Sarbanes Oxley Act (SOX), the Patriot Act, and the New Jersey Department of Banking and Insurance (NJDBI), to name a few.
However, not all Cloud storage solutions have the necessary security measures in place, so New Jersey financial institutions and financial services providers are on the money if they ask their managed IT services provider the following questions when evaluating a Cloud file storage solution:
- Are emails and files encrypted?
- Are there redundancies in the system for backups and failovers?
- Is the system monitored 24/7 and tested proactively for intrusions or potential issues?
- Is security assessment and breach mitigation conducted regularly?
- Do you understand and can you meet compliance requirements?
There are a number of other benefits that financial services companies realize when they add or migrate to Cloud services, reflected in both hard and soft costs to the organization that, on balance, are heavily weighted in the positive column.
- The Cloud enables you to mirror your business-critical systems to guard against a local catastrophe.
- Mobile users (like insurance agents, financial planners, or auditors) and employees across multiple locations can securely access their required systems on the road or from various branches/offices. Schedules, emails, vital documents can all be shared as needed—securely and efficiently.
- File collaboration between different users becomes easier – think of all the players involved in a closing, for instance.
- Files that are backed up to the Cloud are consistent; everyone is using the same version.
- Outsourcing this critical part of your data protection, to a managed IT services provider that does this every day, frees up your organization to concentrate on your core business.
Bottom line: Put Cloud storage on your balance sheet
By their very nature, Cloud storage providers live and breathe security, and some providers have specific products and services geared toward the financial services industry. If deployed and managed correctly, Cloud solutions are as safe as anything you can do in-house (safer in many ways) and are already regulatory compliant.
When used in conjunction with an on-premise backup server, Cloud-based file storage is an integral part of a complete, secure, and compliant file storage solution for financial companies.
The benefits are real; the best advice is to work with your New Jersey IT managed services provider to vet the options and determine the best fit—whether you are a single office, a small business with several offices, or a statewide financial institution. The important thing is to identify the Cloud storage solutions provider that understands, has experience with, and can properly serve the financial services industry—and one that can provide one-hour urgent care response should the need arise.
New Jersey’s IND Corporation offers comprehensive fixed-cost managed IT services to financial services companies across the state. For a free, no-hassle consultation on how Cloud-based storage can improve your financial services firm, contact IND Corp. today.