The global finance cloud market reached US$ 36.9 billion in 2022. Demand for finance cloud stands at US$ 42 billion in 2023. From 2023 to 2033, the market for finance cloud is expected to grow at an 11.8% CAGR, reaching US$ 128 billion by 2033.
The finance cloud market has grown substantially due to the increasing global emphasis on digital banking transactions. This heightened usage of remote working and digital banking is also expected to drive market growth throughout the forecast period. In addition, most financial institutes have had to abruptly adopt remote working in recent years, which has led to a massive hike in cloud-based infrastructure for economic affairs.
The increase in demand for operational efficiency and transparency in business processes and the need for cloud among financial companies act as a critical driving force of the global finance cloud market. In addition, the demand for cloud solutions among small and medium-sized businesses continues to grow as they present several practical benefits, such as eradicating routine upgrades, cost-cutting, and business flexibility. As a result, these factors notably contribute to the development of the global demand for financial cloud platforms. Nevertheless, situations related to data safety, protection, and more elevated investment and maintenance expenses are restraining the development of the finance cloud market.
Conversely, developing economies present significant opportunities for finance cloud companies to expand and grow their offerings, particularly in developing economies such as India, Japan, China, and South Korea. These countries are on the development threshold and require more significant financial resources. Thus, the demand for cost-effective resolutions is anticipated to provide lucrative prospects for market development. In addition, banks, financial institutions, and other financing firms are rapidly transitioning to digitalized business operations. As a result, the adoption and implementation of cloud technology have improved considerably, which is predicted to create new prospects for the market in the forthcoming years.
Financial cloud computing allows financial institutions to reduce their capital expenses. It occurs by eliminating the requirement for extensive on-premises infrastructure. Instead, businesses can pay for their resources on a monthly basis, making it possible for them to scale their computing capacity cost-effectively. This approach significantly reduces upfront costs and is driving the growth of the financial cloud market.
“With cloud-based development and testing environments, banking, financial services, and insurance institutions can quickly prototype and test ideas, speeding up their time-to-market for new offerings. Cloud-based solutions provide on-demand scalability, enabling financial organizations to manage fluctuations in customer demand and transaction volumes effectively,” opines Sudip Saha, managing director and MD at Future Market Insights (FMI) analyst.