The FinTech market is accelerating at a rapid pace. Global investments in FinTech firms reached $5.3 billion over the first quarter of 2016, an increase of 67 per cent when compared to the same period twelve months previous. In order to sustain this growth, the FinTech industry is operating within a very broad market, targeting any and all areas of the financial sector.
[easy-tweet tweet=”One of the areas that #FinTech firms are making an impact in is hedge funds” hashtags=”Investment, Cloud”]
As a result, the day-to-day life of a FinTech business can vary massively depending on its particular circumstances. Everyone from startups to multinational banks are now joining the financial technology sector and many businesses are now focusing on the delivery of bespoke solutions rather than becoming a jack of all trades. Even so, there are some common elements among FinTech firms.
Namely, many FinTech businesses are committed to disrupting traditional ways of working. This could take the form of mobile payment platforms, investment analytics, peer-to-peer transfers or many other yet-to-be-discovered disruptive approaches.
A hedge fund horror story
One of the areas that FinTech firms are making an impact in is hedge funds. Hedge funds may have become synonymous with the worst excesses of the finance industry, but they remain a viable approach to investment. As a result, cutting-edge startups are seeing how they can use digital technologies to reinvigorate an investment strategy that has been in existence since the 1940s.
One of the ways that they are doing this is by utilising data-intensive tools and analytics solutions to help managers and investors optimise portfolios, manage risk and track performance.
Taking a data-heavy approach, however, does come with its challenges, particularly regarding security. FinTech firms store, transfer and analyse vitally important data regarding hedge fund investments and security can be difficult without vast IT resources. Failure to keep this data protected could easily lead to a “hedge fund horror story” where fraud and corruption are allowed to occur.
However, cloud computing can provide FinTech firms with the resources to safeguard hedge fund data while still embracing the latest digital technologies. At Veber, we offer FinTech businesses robust security features as part of our cloud hosting packages. This includes a range of firewall options (virtual, shared and dedicated), anti-virus protection and encrypted access over our virtual private networks (VPNs). The latter is particularly important when it comes to hedge funds, as remote customer access is often necessary.
Another potential horror story surrounding investment technology is not having the required network infrastructure to manage data flows. This could result in poor forecasting, or even unexpected downtime. For FinTech companies operating in an immature market, these kinds of disruptions can be terminal to future business success. With cloud computing, however, organisations benefit from the network infrastructure of their third-party vendor. Our network technology promises high availability and increased performance to ensure that FinTech businesses and their customers have access to the data that they need, whenever and wherever they need it.
[easy-tweet tweet=”#Cloud computing can provide #FinTech firms with the resources to safeguard investment data”]
The FinTech industry is changing fast. What the future holds is difficult to say, but data will likely remain at its heart and cloud computing offers the industry the security, reliability and scalability that can prevent FinTech horror stories from becoming a reality for your business.
Neil Laver, Veber