This is the third blog in a series on financial services where I investigate a few challenges of managing hybrid cloud operations in the payment application development arena. In the first blog, I explored new trends in traditional banking. In the second blog I focused on some of the challenges insurance companies face while navigating their digital transformations.

In this blog, we will look at how payment application companies stay at the forefront of innovation by continuously meeting consumer demand for speedy, flexible, secure, and seamless payment experiences.

The evolution of electronic payment technology

Looking back, consumers were first able to pay for goods or services electronically with the birth of the BankAmericard credit card, founded in 1958 and later becoming Visa in 1977.

Since 1994, online banking and bill pay has been readily available through mainstream internet technology tied to individual bank accounts, while mobile web payment (WAP) capabilities became available in 1997 with the advent of the smart phone.

By the end of 2023, it is expected that$1.152 trillion will transact

via mobile P2P apps, according to a report by Insider Intelligence.

In this era of convenience-on-demand, consumers are expecting to be able to pay for any number of goods or services through various websites and phone apps. The demand for just one provider's services (PayPal) exemplifies the popularity of digital payment systems. According to this article in the Web Tribunal, PayPal is the largest digital payment systems provider commanding more than 54 percent market share, far exceeding the next two providers' market share combined. More than 1.6 million websites globally rely on PayPal for the checkout and payment process, generating 15.4 billion transactions across 392 million active users who spend more than$2.5 billion through PayPaldaily.

 Managing multi-cloud environments demands a new operating model

What these consumers are likely not thinking about is the complexity behind performing a seemingly simple transaction that in reality requires tight coordination among mobile networks, cloud operators, financial institutions, credit card companies, merchants, and security/fraud protection providers -all in real-time and in microseconds. In fact, it is imperative that digital payment companies like PayPal continue to innovate and invest in their digital infrastructure to provide the simplest and user-friendly experiences for consumers and merchants at all times. Behind the scenes, these providers must also ensure security, governance, and compliance as there is really no room for error since billions of dollars are changing hands every second of the day.

Faced with constant pressure to quickly create and deploy new services and features, most payment application companies utilize different cloud providers to flexibly maintain their services to consumers. Containers that run behind the scenes, regardless of the underlying infrastructure, offer the agility and flexibility that modern developers need. However, the tasks involved in offering these services are becoming more complex to provide consistent services in today's hyper-distributed world. Containers built to support the functionality could potentially be in different locations for example, on prem, or in multiple cloud environments. How do we ensure companies have visibility into containers spread across multiple locations with potentially different compliance requirements within your current operating model?

In addition, many mission-critical workloads must stay on-prem to meet security and/or data sovereignty regulations. Managing operations across multiple public cloud and on-prem resources simultaneously is becoming more difficult. Payment application companies must adopt a hybrid cloud strategy and operating model to effectively manage their resources and allow the teams to switch seamlessly between the various environments, while ensuring constant, uninterrupted application availability for their end users.

Hybrid Cloud Operating Model as the Solution

A successful cloud operating model can deliver important benefits for pay app companies. This can often include investing in a hybrid cloud operations platform like Cisco Intersight to help them streamline and unify their IT operations across private data centers, public clouds, and the network edge with highly secure, cloud-delivered management. Intersight makes it simple for customers to adopt an innovative cloud operating model that enables quick growth and expansion. Our solutions are built for public cloud integration, which allows customers to easily scale, manage, and operate cloud-native applications across on-prem and cloud environments. End-to-end application security is built-in across the full lifecycle, not just during deployment alone.

For more information on how Cisco can help simplify your hybrid cloud operations and deliver the business results you are looking for, please visit: Cisco Hybrid Cloud Solutions.

Resources:

The Big Data Explosion

What's new in Financial Services at Cisco