Digital trends in financial sector Cloud success cases in Mexico

Por Tania Karina Álvarez Mendoza

Publicado en noviembre 19º 2024

Introduction

The financial sector in Mexico is leading digital innovation efforts, thanks to business initiatives to improve the experience for costumers and the launch of products available to wider segments of population, especially those lacking access to financial services.

In this sense, financial institutions prioritize the development of digital services to:

Deliver high quality customer services through all channels, both digital and traditional.

Gain deeper knowledge about clients’ needs.

Develop personalized services, through data and artificial intelligence tools.

In this regard, financial sector operations leverage massive data from millions of operations, transactions and clients, whose management through traditional IT models restricts the modernization and expansion of the sector. Aware of these limitations, CIOs are taking advantage of cloud services to allow an increase agility to deliver up to business initiatives.

The proper adoption of secure cloud enables the accelerated creation of new financial products and services, thus encourages competition, generating better services.

The top benefits of cloud adoption, highlighted in Select research, match those presented in success cases of AWS costumers in Mexico and LATAM:

Cost reduction: Investment in the acquisition and maintenance of technological infrastructure is reduced, and financial institutions benefit from the economies of scale of cloud providers¹.

In this regard, Itaú Bank in Brazil has adopted the AWS public cloud to implement Pix, an instant payment system. The cloud allowed them to integrate quickly and securely, improve efficiency and reduce operating costs.

Rodrigo Dantas, director of Itaú Unibanco, mentioned that “Taking advantage of the AWS on-demand instances and elasticity, we reached an 80% cost reduction in Pix payment transaction costs when compared to other forms of payment”².

Increased efficiency: There is greater agility when implementing new financial products or services, services are offered to financial institutions of different sizes, which increases competition and reduces the workload³.

Grupo Bursátil Mexicano (GBM), an investment firm, by using AWS Marketplace solutions, improved the reliability of its backend infrastructure, reported an average savings of 30% in acquisitions and a significant reduction in support resolution time, using innovative solutions for data protection and management⁴.

Improve security: Financial institutions' infrastructure can be visible and exposed to attacks, and small and medium-sized businesses cannot always afford to invest in cybersecurity. Hyperscalers, on the other hand, have automated mechanisms to detect and remedy these problems⁵ and have backup storage and management and disaster recovery planning⁶.

Jorge Alejandro Castillo, corporate technology director of Banca Afirme, believes that the use of cloud services will allow them to design positive and fluid experiences for their clients with flexibility and agility, in addition to providing greater cybersecurity in the context of open banking⁷.

Increase resilience: Hyperscalers can handle attempts to disrupt operations very efficiently. Distributing data across multiple centers makes it available even when a particular center experiences an outage, and moving data from one provider to another is a fast process⁸.

Conekta is a Mexican company focused on online payments. They have leveraged AWS to scale their infrastructure. The public cloud allows them to handle large volumes of transactions securely and reliably, improving user experience and reducing costs⁹.

Data analysis: Cloud services facilitate the analysis of large volumes of data in real time and on an ongoing basis. Data analysis tools can be leveraged to improve risk monitoring in the financial system and facilitate the detection of fraud or money laundering¹⁰.

Banregio Financial Group migrated to the cloud with AWS motivated by the interest in the benefits of big data, analytics and artificial intelligence. This allowed them to use the data to understand their clients and launch new products quickly.

Alfredo Pequeño, Chief Data Officer at Banregio commented: “We needed more capacity. In terms of maintenance, it would have been difficult to do what we had planned in an on-premises environment”¹¹.

Konfío, a Mexican fintech, also uses AWS to analyze large amounts of data and offer loans to small and medium-sized businesses. The public cloud has allowed them to implement AI and machine learning solutions, thus improving the accuracy of risk assessment and speeding up the credit approval process¹².

Business: The use of cloud also enables market adaptability, improves business scalability and adoption of new businesses, facilitates services for clients and reduces time to market services, and increasing the capacity for innovation¹³.

BBVA has used AWS to digitally transform its operations across Latin America. The public cloud has been essential to improve agility, security and scalability, allowing them to offer a better experience for their clients by providing personalized services¹⁴.

For his part, Aldo Valadez, director of analytics at Banregio, points out a considerable reduction in the time to develop new data models, going from two years to two weeks, and the costs are now one-tenth of what they would have cost using a different tool¹⁵.

Kueski, a Mexican financial institution focused on unserved customers, improved their origination process by using AWS AI/ML. Kueski uses technology and algorithms to automate origination process which allows them to authorize loans in minutes since gathering customer documentation till loan approval and disbursement¹⁶.

Finally, in Colombia, Banco de Bogotá implemented facial recognition solutions in its services using AWS Rekognition. The cloud has been essential to improve security and customer experience, allowing for fast and accurate authentication¹⁷.

Conclusions

In Mexico, the financial sector is at the forefront of digital innovation. They are motivated by offering better services to wider segments of population.

These institutions focus on offering digital services, they seek to know their clients and offer them targeted services through machine learning and AI.

Cloud adoption has proven to be an effective strategy for companies across a variety of sectors and regions. Success stories from the financial sector in Mexico, Colombia, Brazil, and LATAM highlight that proper cloud adoption drives innovation, improves operational efficiency, and delivers better customer experience. The cloud not only reduces costs, but also provides the flexibility and scalability needed to meet today's market challenges.

Sponsored by AWS

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