Finance Cloud Market

The Finance Cloud Market size is projected to grow from USD 135.6 billion in 2023 to USD 268.1 billion by 2028, at a Compound Annual Growth Rate (CAGR) of 14.6% during the forecast period. The impact of the recession (before and after the recession) on the market is covered throughout the report.

Our modern-day lives are overfilled and loaded with the latest digital developments. Financial Cloud computing allows financial institutions to reduce capital expenditures by eliminating the need for extensive on-premises infrastructure. Instead, firms pay for their resources on a pay-as-you-go model basis and can cost-effectively scale computing capacity. This model significantly reduces upfront costs. And drives the market. With cloud-based development and testing environments, BFSI institutions can rapidly prototype and iterate ideas, accelerating the time-to-market offerings. The cloud provides on-demand scalability, allowing financial institutions to manage fluctuations in customer demand and transaction volumes effectively. These are critical driving forces for the Finance Cloud market.

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Recession Impact on the global finance cloud market

With the recession threat looming over the US, chief information officers are reexamining their budgets to save expenditures. According to the Morgan Stanley analysis, cloud computing, security software, and digital transformation would remain top objectives for CIOs in such a situation. The impact of the recession on the Finance Cloud market in North America is likely to be severe as the US and Canadian economies are expected to dip in 2023 compared to 2022. A recession might affect Europe’s infrastructure markets, hampered by transportation issues and a shortage of components. Increasing interest rates will force companies to reduce bank loans, allowing slow demand for infrastructure. According to the South China Morning Post, China faces external headwinds ranging from debt shocks in the developing world to monetary policy spillovers from the United States.

In contrast to several countries worldwide, Saudi Arabia’s economy will grow this year quickly. The country’s GDP will grow by 7.6%, with inflation at 2.8% in 2022. The crisis has not hit Middle Eastern economies as hard because they are not as integrated into the global economy and have fewer ties to international financial institutions. However, they will probably experience side effects like higher unemployment and further decline in living standards due to reduced capital flows.

Finance Cloud Market Dynamics

Drivers: Personalized customer experience with cloud computing for financial services

In recent years, consumer behavior and demands have undergone significant changes. Enterprises now prioritize meeting these demands to remain competitive in the finance cloud market. Increased customer expectations and competition among market leaders have led to a need for cost-effective measures that improve operational efficiency. Enterprises that rely on manual processes for critical business activities face challenges due to these tasks’ tedious, repetitive, and time-consuming nature. Cloud computing offers new ways for enterprises to engage with employees and customers and improve overall workplace productivity.

Restraints: Increasing new regulations and financial standards

The financial services industry is evolving due to new regulations and risk assessment methods aimed at promoting global standardization. However, companies face the challenge of keeping up with these changing financial standards and regulations, including BCBS, Doff Frank, MiFID, IFRS, and others, which can limit the growth of basic financial analytics. Advanced financial analytics software with compliance capabilities can help financial institutions and personnel adapt to these regulatory changes and minimize non-compliance risk. Significant companies like Oracle, IBM, TIBCO Software, SAP, GoodData, and Qlik offer financial analytics software that adheres to these new standards and regulations. The self-learning capabilities of AI algorithms may also drive the growth of the financial analytics market by improving compliance.    

Opportunities: Evolution of AI/ML, along with other advanced technologies and implementation

AI in Finance is increasing as organizations look to speed up investment decisions. Machine learning and AI have improved the ability to analyze information quickly and effectively, with minimal human intervention. For example, Fukoku Mutual Life Insurance has implemented AI to calculate payouts for policyholders, ensuring they meet regulatory standards and collect high-quality data. The potential for AI to revolutionize the industry is vast, with its ability to provide regulatory compliance, accurate equity predictions, and prevent fraud and risk. It can also suggest portfolio solutions to meet the demands of individuals. Despite being in its early stages, AI is set to fuel the growth of the finance cloud market due to its increasing popularity. By adopting AI in the financial sector, the industry can improve trust, accuracy, and resilience, ultimately benefiting the entire ecosystem.

Challenges: Limitation(s) in interoperability and flexibility in operations

Organizations often find it challenging to switch from one cloud service provider to another. The reason is that applications developed for one cloud platform must undergo a rewriting process to be compatible with the new one, which can be complex and time-consuming. Moving data, setting up security measures, and configuring networks can pose further challenges when transitioning to a different cloud solution. These factors can limit an organization’s ability to switch between cloud providers quickly and efficiently.

Finance Cloud Market Ecosystem

Based on the deployment model, the public cloud segment will hold the largest market share in the Finance Cloud market during the forecast period.

In cloud computing, a public cloud deployment model is when a third-party cloud service provider owns and manages cloud resources and services accessible to the general public or a wide range of customers via the Internet. Many organizations share these resources, and users typically pay for the services on a subscription or pay-as-you-go basis. The cloud provider hosts and manages public cloud services in their own data centers, which offers flexibility, scalability, and cost-effectiveness. Amazon Web Services (AWS) is a well-known public cloud provider that provides various cloud services, such as databases, storage, computing power, machine learning, and more. Customers can access these services over the Internet to host websites, run applications, store data, and perform various computing tasks without managing their physical infrastructure.

Based on offering, the services segment to hold a higher CAGR in the Finance Cloud market during the forecast period

Financial cloud services offer expert consultancy during the initial stages of implementation, helping businesses choose, configure, and customize their finance cloud solutions to meet their specific needs and industry regulations. These experts ensure a seamless transition to the cloud, optimizing financial processes and ensuring compliance with best practices. Additionally, managed services are crucial for the ongoing management and maintenance of cloud infrastructure and financial applications. Managed service providers oversee system monitoring, security management, performance optimization, and troubleshooting, allowing businesses to focus on their core financial operations while ensuring their cloud-based financial systems’ reliability, availability, and security. Together, finance cloud services provide companies with a comprehensive framework to fully utilize the benefits of cloud technology while minimizing operational complexities and enhancing financial agility.

North America to hold the largest market share in the Finance Cloud market in 2023.

North America has captured the largest market size of the finance cloud market. The US and Canada are the prime countries in North America contributing to the growth of finance cloud. According to MarketsandMarkets analysis, it has been observed that more than 91% of the companies have at least one service on the cloud and more than 55% of the organizations have deployed cloud solutions. Reduced CapEx spending, low IT management complexity, improved agility, and security are some of the major driving factors contributing to the growth of cloud computing in North America.

The increasing number of alliances and partnerships among finance cloud and other technology providers for continuous technological innovations and advancements in finance cloud have further added to the growth of the global market in North America. For example, SAS, an edge analytics solution provider, and HPE, a finance cloud service provider, collaborated to launch comprehensive IoT analytics solutions. IoT is trending in North America; with more IoT devices getting connected, the region has seen broader adoption of finance cloud solutions among end users. The presence of connectivity networks will act as a driving factor to facilitate the adoption of finance cloud. The average number of digital devices available to the citizen is increasing exponentially. People are better connected with enhanced access to brand and content. This would widen the opportunity of finance cloud in the region.

Key Market Players

The Finance Cloud market is dominated both by established companies as well as startups such as AWS (US), Microsoft (US), Google (US), IBM (US), Salesforce (US), Tencent (China), Oracle (US), Alibaba (China), Workday (US), SAP (Germany), HPE (US), VMware (US), Cisco (US), Huawei (China), ServiceNow (US), DXC technology (US), SAGE Group (UK), Snowflake (US), Nutanix (US), Acumatica (US), RapidScale (US), AtemisCloud (US), Rambase (Norway), OVHcloud (France). These vendors have a large customer base, a strong geographic footprint, and organized distribution channels. They incorporate organic and inorganic growth strategies including product launches, deals, and business expansions, boosting revenue generation.

The study includes an in-depth competitive analysis of these key players in the Finance Cloud market with their company profiles, recent developments, and key market strategies.

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Scope of the Report

This research report categorizes the Finance Cloud Market to forecast revenue and analyze trends in each of the following submarkets:

Based on Offering:

• Solutions
  • Financial forecasting
  • Financial Reporting & Analysis
  • Security
  • Governance, Risk & Compliance
  • Other solutions
• Services
  • Professional Services
    • Support & Maintenance
    • Deployment & Integration
    • Consulting
  • Managed Services
• Managed Cloud Infrastructure Services
• Managed Network Services
• Managed Security Services
• Other Managed Services

Based on Application:

• Revenue management
• Wealth management
• Customer management
• Account management
• Other applications

Based on the Deployment model:

• Public Cloud
• Private Cloud
• Hybrid Cloud

Based on Organization Size:

• Large Enterprises
• SMEs

Based on End User:

• Banks
• Financial service providers
• Insurance companies

Based on Region:

• North America
  • US
  • Canada
• Europe
  • UK
  • Germany
  • France
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • Rest of Asia Pacific
• Middle East & Africa
  • Saudi Arabia
  • UAE
  • Rest of the Middle East & Africa
• Latin America
  • Brazil
  • Mexico
  • Rest of Latin America

Recent Developments

• In September 2023, Workday partnered with Accenture. This partnership aims to help organizations reinvent their finance functions to become more agile, data-driven, and customer-centric. This global partnership between Workday and Accenture brings together the power of its cloud-native platform with AI and ML at the core and some of the industry’s most forward-thinking and innovative experts to help its customers take advantage of transformative technologies to accelerate change across their financial operations while being adaptable and resilient.
• In September 2023, Tencent Cloud launched Tencent Cloud Blockchain RPC. This product is developed with Ankr. By introducing Blockchain RPC, Tencent Cloud strives to provide a blockchain node infrastructure solution that has speed and is robust, enabling developers to stay ahead in the rapidly evolving Web3 environment continuously.
• In August 2023, Google partnered with Brillio. This partnership will expand Brillio’s ability to infuse generative AI into its customer experience (UI/UX/web experience), engineering, and data offerings, thus enabling clients to unlock more excellent value by industrializing processes and reducing time-to-market and cost-to-serve. Brillio’s generative AI solutions, powered by Google Cloud’s Vertex AI, will enable financial services organizations to interpret loan applications better, empower call center executives, provide investment advice, and summarize portfolios more effectively.
• In July 2023, SAP launched its SAP S/4HANA Cloud, Public Edition 2308 Release. This latest release would deliver a built-in, intelligent, modern experience across all SAP’s business processes and several enhancements to help make the SAP S/4HANA Cloud, public edition user experience more modern, productive, and collaborative for end users and IT.
• In June 2023, Microsoft partnered with Wipro. This partnership will bring together Microsoft Cloud capabilities with Wipro FullStride Cloud and leverage Wipro’s and Capco’s deep domain expertise in financial services. Capco is a business and technology management consultancy firm owned by Wipro, operating primarily in the financial services and energy vertical(s). Using Microsoft Cloud for Financial Services, Wipro has already delivered various innovative solutions that will assist financial institutions in speeding up time to value and drive sustainable growth.

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