Bank of England to crack down on ‘secretive’ cloud computing services

LONDON: Cloud computing providers to the financial sector can be “secretive”, and regulators need to act to avoid banks’ reliance on a handful of outside firms becoming a threat to financial stability, the Bank of England said on Tuesday.

Banks and other financial firms are outsourcing key services to cloud computing companies such as Amazon, Microsoft and Google to improve efficiency and cut costs, with the trend accelerating last year as the COVID-19 pandemic unfolded.

The BoE said cloud computing could sometimes be more reliable than banks hosting all their servers themselves. But big providers could dictate terms and conditions – as well as prices – to key financial firms.