Banks allowed to use ‘cloud’

The Bangko Sentral ng Pilipinas has given banks the go-ahead to adopt “cloud” technology as a means to safeguard customer-related and other data amid risks of natural disasters.

BSP Deputy Governor Nestor Espenilla on Wednesday said that banks in the country could now upgrade their information technology systems into one that involved the use of cloud technology.

Cloud technology allows storage of data on the Internet. Often referred to as “the cloud,” it is a service wherein a third-party firm provides clients with computing resources such as servers, networking, storage and data center space for a fee. As such, damage or destruction      of computer facilities due to natural disasters or other causes need not lead to a disruption of business operation.

“One advantage of that technology is data recovery in case of disasters,” Espenilla said at the sidelines of a forum organized by Microsoft and the Financial Executives Institute of the Philippines (Finex).

He cited the case of banks in central Visayas that were hit by Supertyphoon “Yolanda” in November. The affected banks, many of which were rural banks, had a difficult time recovering data because of the resulting damage to their information-storage systems.

Another advantage of cloud technology is its ability to reduce the cost of data storage and Espenilla said this would improve the competitiveness of small banks.

“The technology provides smaller financial institutions the ability to compete with bigger ones,” he said.

He said that having a reliable IT system was one of the regulatory requirements banks had to meet.

The official, however, said banks were required to conduct the necessary due-diligence when adopting cloud technology.  Michelle V. Remo