The U.S. Treasury Department is warning financial firms to check their cloud services or risk leaving vulnerabilities festering without fixes. According to the department, small and medium businesses are the most at risk when not checking cloud services from Big Tech companies such as Google, Amazon, and Microsoft.
Financial firms are now increasingly using cloud services across their ecosystems. While these options streamline financial services and make them more efficient, there are challenges to implementing cloud solutions.
Deputy Secretary of the Treasury Wally Adeyemo admits “there is no question that providing consumers with secure and reliable financial services means greater demand for cloud-based technologies,” but there needs to be “safe and effective migration” as financial firms turn to the cloud.
“Treasury found that cloud services could help financial institutions become more resilient and secure, but that there were some significant challenges that could detract from these benefits,” the department writes in a report.
We are in an era when industries are turning more to the cloud. This is likely to accelerate as AI becomes a key component to cloud infrastructure. Yesterday I reported on Microsoft, Google, and Amazon entering into a cloud AI arms race. The Big Tech companies are hoovering up cloud AI startups and talent.
Microsoft is already baking AI into its cloud services with Azure OpenAI. Microsoft has recently made that platform generally available with ChatGPT coming soon. This week, it emerged Microsoft is working on giving organizations access to ChatGPT technology to build their own chatbots.
Potential problems include exposure to cyber-attacks. Another issue is the industry is becoming increasingly reliant on a small few cloud providers. It comes as no surprise that these are major platforms such as Amazon Web Services, Microsoft Azure, and Google Cloud.
Furthermore, the report points to an inconsistent global market where rules differ from one country to the next. This means major international firms find it hard to adopt the cloud across a global infrastructure.
The Treasury report adds recommendations to help the financial sector more safely turn to the cloud. In the report, the department also makes it clear it “neither endorses nor discourages cloud service adoption by the sector.”
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