We hear the term ‘the cloud’ or the phrase ‘cloud-native’ a lot in the fintech and payments space. But far from being a faddy buzz-term cloud-nativeness is key to advancing payments innovation and is essential in improving the customer journey.

So, what is it?

In a nutshell, cloud-native refers to technologies that are designed and assembled to run in cloud environments. This means they are super flexible and scalable, as they are independent modules designed to live in and be deployed via the cloud. On the flipside, you have cloud-enabled technologies that have been adapted to work with cloud infrastructure, but they are trickier to scale and adapt since they rely on other modules within the system’s infrastructure. Cloud technology brings great benefits to businesses, including its ability to transform how teams can collaborate to meet customers’ needs.

And why should you care?

Well, cloud-nativeness opens up a whole world of possibilities. Cloud-native technology allows organisations to run scalable applications in ever-changing environments, meaning it also allows companies to innovate to overcome payment challenges. And that’s why I’m excited about it — I’ve seen first-hand how easy companies like PagoNxt can assemble their own services through a cloud-native approach. I’m a true convert and believe that cloud-nativeness is facilitating innovation in the payment space on several fronts, not least because it offers a rapid way to overcome global payment challenges.

Fast innovation

Through cloud-nativeness it’s easy to identify a problem as soon as it arises, while simultaneously developing a solution that can be instantly rolled out to customers. The open platform therefore facilitates greater speed-to-market for new products and services, as cloud native systems are typically easier to configure, and don’t require much time to set-up. For example, at PagoNxt, our cloud nativeness has enabled us to bring products to the market in record time. Previously, if we wanted to update our platform it could take months. Now we are looking at a matter of weeks. The time it takes to roll out new services has improved dramatically.

Such agility and speed of business processes means that when we have a good idea, we can test it, fail fast and build a workaround even faster, to tackle any issues. In the past, if we wanted to update our platform, we would need to do a full regression of the platform to identify where our updates would affect other areas. However, using cloud-native solutions, it is easy to identify where our platform updates will have an impact in record time. This efficiency means that we create great products and services for our customers around the world and can constantly adapt them to meet customer demand in the notoriously fast-moving payments and retail markets.

Adapting to market changes

As more shoppers use digital payment platforms, payment companies need to be aware of what the digital-savvy global population wants. Awareness is not enough though; payment providers need to innovate to customers’ changing payment preferences or risk becoming the equivalent of a DVD store to a streaming service. This is where the value of cloud-native solutions is demonstrated, as it means that the platform can be structured to improve the customer journey, in unity with broader business objectives.

To meet and exceed customer expectations, cloud-nativeness in the payment space allows fintech companies to adapt to market changes using a fast and flexible IT infrastructure. This type of infrastructure considers ‘user stories’, to ensure that the service offered to customers is aligned with the broader user story that has been outlined by the business. The scalability and elasticity of a cloud-native system allows payment companies to remain part of the global payments ecosystem by adapting to market changes, whether this entails updating products or facilitating collaboration with third-parties.

PagoNxt did just this through cloud-nativeness. My team recognised the growing demand from merchants for up-to-date information on the location and status of their shipments. Through One-Trade, which uses an API integration, we were able to offer real-time data to our customers that allowed them to pinpoint exactly where their shipments were throughout their journey. This is just one example of how cloud-nativeness advances innovation by allowing fintech companies to change and update their products and services based on market changes and fluid business preferences.

Global reach

At PagoNxt we are passionate about financial inclusion and offering financial services to the unserved and underserved communities around the world. For some fintech companies, their digital infrastructure limits where they can operate, but cloud-nativeness enables PagoNxt to have a global reach.

We want to be open to the world, so we’re assembling an open-platform. Cloud-native infrastructure can scale to any size and be deployed anywhere in the world, allowing payments companies to serve their customers no matter where they are. At PagoNxt, our cloud-native solutions allow us to update software to support merchants in the US, Latin America, and Europe at speed.

The capability to reach underserved communities enables innovation to be at the forefront of product development, with these communities front-of-mind. This is how we have successfully brought Superdigital to life at PagoNxt, a platform that uses architecture that is 100% cloud-native. When we consider global payment challenges, we know that our innovative new services and products will reach the intended market, with minimal obstacles. It means we’re able to make good on our mantra to always design products with the end-user in mind and enhance it further by allowing international experience to inform innovation, advancing progress in the payments space and addressing the barriers to financial inclusion.

Security

As a fintech company, without robust security you have nothing. We process millions of transactions around the world everyday with our global Trade and Merchant services, and we handle sensitive information on a daily basis. Therefore, we recognise how cloud-native applications provide several features that keep data safe.

This includes the isolation of services, which prevents one service from affecting another, and ‘least privilege’, which offers staff access to only the resources they need to do their job. Moreover, cloud-native solutions also offer security automation, enabling intrusion detection and vulnerability scanning to be automated, allowing staff to have greater freedom and control in how their work is shared. In my opinion, cloud-native solutions are the most secure means of protecting merchants and customers, as it enables adaptation to stay ahead of emerging payment threats.

In an assessment of PagoNxt’s use of cloud-native infrastructure, Microsoft rated us as outstanding on 250 different topics, including automation and security. You cannot be global without security and automation, and these two factors are essential in fostering successful innovation.

So that’s my pitch for why I see cloud-nativeness as critical to advancing innovation in the fintech and payments space. Whether it’s enabling fintech companies to solve payment challenges anywhere in the world, or offering additional security and adaptability to market changes, there are numerous benefits to implementing cloud infrastructure. Our assessment with Microsoft is testament to the value that cloud-nativeness can have on a global payments company, and I would urge other entities in the global payment ecosystem to take note of our success. I’d love to hear your thoughts on this too via the comments or reaching out via our social channels.

Fintech

Payments Technology

Payments Industry

Cloud Native

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