The digitalization of financial services went into overdrive during the COVID-19 pandemic. With brick-and-mortar banks and offices shuttered under lock-down, consumers became even more reliant on digital interactions to manage their money, make investments, apply for credit, and more. And this trend shows no signs of diminishing post-pandemic—quite the reverse. How can edge computing help?
This puts the digital customer experience at the center of FinServ businesses. Deliver an exceptional online experience—personalized, secure and frictionless—and you create sticky customer relationships. Deliver a sub-optimal experience, and your customer can easily go elsewhere.
No wonder the financial services sector has been an early adopter of edge computing. Relying on a centralized data center model to deliver next-generation FinServ digital experiences is not workable. For many customer applications, storing and processing data at the edge, and closer to the users and devices, is the way to go.
Financial Services edge computing in action
So how does edge computing make an impact in practice? Let’s consider some real-world examples.
- Accelerating authentication. Automating user authentication by comparing logins to known data—like facial recognition—at the edge is an ideal way to accelerate access for authorized users while blocking bad actors. This is a great example of what edge computing is good at: handling high-volume, relatively simple compute workloads very rapidly.
- Personalizing engagement. Running AI-powered applications at the edge can enable sophisticated personalization to individual customers without overburdening the data center; for example, “push” notifications for specific financial service offers tailored to a customer’s preferences or past activity. Edge capabilities can also help improve the user experience by dynamically optimizing content based on a customer’s network conditions and device type.
- Optimizing analytics. Data is the lifeblood of many financial enterprises. With so much data being generated, the task of surfacing valuable insights is monumental. Aggregating and analyzing data at the edge can reduce the massive wave of raw data flooding the data center, while delivering actionable insights to guide business decisions.
- Business continuity. In the event of a major disruption to the Internet, critical functions could still be performed at the edge, maintaining some level of service continuity for customers. Performing compute functions at the edge also reduces the overall amount of traffic to and from the data center, increasing the chances that data that does require data center access can get to its destination.
Edge computing advantages
Performing compute workloads at the edge offers some important advantages for enabling next-generation digital services:
- Speed. Moving compute resources closer to consumers and their devices eliminates the need to shuffle data to a centralized data center and back. This reduces latency down to single-digit milliseconds, enabling a better user experience.
- Scalability. Edge computing eliminates the intervention that centralized models require to scale or add capacity. FinServ organizations can expand to serve new customer groups or regions without costly and time-consuming data center expansion.
- Security. Keeping compute workloads close to the edge can enhance protection of critical data assets. Reducing traffic back to the central data center or cloud reduces the risk of unauthorized access to centralized databases with personal financial information. This enhances protection against common threats, including malware and ransomware attacks.
- Cost. Building and maintaining large data centers is costly. And so is bandwidth. Pushing compute workloads to the edge reduces capex and network bandwidth expenses.
Three factors for earning trust
So how can FinServ organizations harness these advantages to deliver exceptional services that give them a competitive advantage? Edge computing offers advantages that support three key success factors for the digital marketplace: availability, usability and security.
When a customer goes to log on to their bank’s website or investment firm’s online portal, they expect it to work. If the site exhibits performance issues, the customer may question the firm’s ability to manage their money. Web traffic for financial services organizations is up 30% in Q1 2022 compared to Q1 2020 according to Akamai observations, placing even greater demand on maintaining availability and performance. With edge computing, frequently accessed information can reside close to the users needing it, improving access performance while reducing data center traffic and workloads.
FinServ customers today expect the same personalized experiences they receive from consumer services like Amazon and Netflix. Edge computing accelerates the look-up of customer preferences and subsequent presentation to deliver a tailored experience.
Securing customers’ financial and personal data is critical. Mitigating the growing risk posed by cyber crime is essential to prevent breaches that can lead to devastating reputation damage. Existing strategies like virtual private networks (VPNs) and multi-factor authentication (MFA) are no longer sufficient. Effective security requires adopting modern frameworks like Zero Trust network architectures and Secure Access Service Edge (SASE) that provide more sophisticated security controls at the network edge, close to end users.
The key is to strike the right balance of these factors. You need to make it easy to do business online, while still providing robust protection against unauthorized access. Edge computing can help achieve that tricky balance, enabling both accessibility and security.
This is just the beginning
We are only scratching the surface of the potential applications for edge computing in the financial services sector. Virtual reality, augmented reality and emerging online “metaverses” have the potential to fundamentally change how customers interact with their bank and other financial service providers. Given the tremendous bandwidth and compute requirements of these technologies—and the need to authenticate those virtual users and personalize their interactions—edge computing will play a central role in making them viable.
There is no need to wait for that future. Implementing an edge computing strategy now that optimizes availability, usability and security will enable your organization to deliver the immediate, personal, secure experiences today that put customers at the center of your service strategy.