With all the concerns that remain around cloud security, perhaps having a leading financial entity heading into the great blue yonder will be a turning point for smaller businesses. Last week, the NASDAQ announced that it will leverage Amazon Web Services in order to offer two platforms geared to assist brokers with compliance-driven storage needs. The new offering, called FinQloud, is a platform for financial services applications that will help brokers meet regulatory compliance requirements around storing and managing records tied to financial transactions. The offerings are described thus:
Regulatory Records Retention (R3) will provide broker-dealers with a storage and retrieval tool to help meet U.S. Securities and Exchange Commission Rule 17a-4 record retention obligations at substantially reduced cost and complexity. Self Service Reporting (SSR) will enable broker-dealers to perform fast, on-demand analysis and reporting on their stored trade data. To meet the stringent operational and regulatory security requirements of the financial services industry and to protect data integrity, all connections to FinQloud will be required to pass through a rigorous encryption key management system. The encryption key management system will be housed in private NASDAQ OMX data centers before directly connecting to AWS.
What excites me about this announcement is that a major financial services group has determined that, with the correct security components in place, the cloud can offer a safe and economical answer to the compliance regulations that many financial services (and healthcare) businesses need to meet. Those rules require the businesses not only keep a deep inventory of records, but that they are kept private and yet easily accessible for review. The cloud can offer all the space those businesses need, plus the instant access to records and the security necessary to protect clients’ privacy. The question now is whether other financial services organizations will follow in the NASDAQ’s footsteps?