"One-in-two banks and insurers have not moved their core business applications to the cloud," the report said.
As many as 91 per cent of banks and insurance companies have now initiated their cloud journey, a significant increase from 2020, when only 37 per cent of firms had embarked on their cloud transformations.
However, this high rate and its corresponding investment do not translate to effective cloud adoption at scale. More than 50 per cent of firms surveyed have only moved a minimal portion of their core business applications to the cloud, the report said.
The value of AI and Gen AI can be better realized through the right cloud adoption at scale, hence banks will need to prioritize cloud journey for fintech growth, a senior Capgemini executive said.
Capgemini Industry Platform Leader for Banking India Anuj Agarwal said, "Today, we see FinTechs specializing in numerous areas that leverage AI to add significant value to banks. Examples of such areas include automation, personalized customer experience, better mitigation of financial crime and risk management." India has one of the highest AI skill penetration levels in the world, has been seeing significant investment in AI, as well as demand for AI solutions, and with the government push towards a digital India, will also have immense data availability, which will help in India's fintech revolution, he added.
Agarwal said, elaborating on the inaugural Capgemini Research Institute's World Cloud Report on financial services, "Through our research, we found that banks are generally struggling to offer clients the desired value and personalization that they seek. Hence it is critical for them to offer the right Customer Experience and improve their operational efficiency, to plug this expectation gap." In wealth management, over half (60 per cent) cite benefits in relying on cloud-enabled fraud detection techniques to make data-driven risk-management decisions. Likewise, more than one-third of retail banking executives (39 per cent) emphasize transitioning complex credit risk management to the cloud to shorten loan processing decision time, through cloud-enabled automated processes and integrated analytics.
Cloud-based scalable and composable platforms will emerge as a key enabler for this journey, the report further suggests.
The report cites global data of two primary research surveys and 30 interviews with financial service executives from 20 countries and 14 markets within the United States, Canada, the UK, France, Germany,Spain, the Netherlands, the United Arab Emirates, Singapore, Hong Kong, Japan, China, India, and Australia.