Cloud is the future of payments, though many payments companies are still operating with on-premise servers that are difficult and expensive to manage. We look at the benefits of hosting a payments infrastructure on AWS.

Companies that play in the payments space must adhere to a slew of regulations and be compliant with Payment Card Industry (PCI) standards for data storage and management.

Not only are these organizations tasked with maintaining the physical security of systems, but they must also be sure to fully encrypt both at rest and in-flight sensitive payment card information that is collected at the point of sale. Systems must be audited regularly, and changes must be documented. Achieving PCI compliance in a cost-effective manner is a top priority for most payments organizations.

While compliance is a top priority, it’s also only one piece of the puzzle. Payments technology companies must remain secure while also staying agile, consistent, and innovative. Achieving all those things on a budget can be a tall order. This article looks at the many challenges that payments companies face and why hosting a payments infrastructure on Amazon Web Services (AWS) can be beneficial.

Challenges

Payments organizations that are operating via on-premise servers face a broad swath of challenges that can inhibit their ability to remain cutting edge and competitive. Balancing agility with compliance and security can be a challenge — but it’s not an insurmountable one.

Here are some of the common challenges that organizations face:

Scalability

On-premise servers require enough data-storage and processing to handle customer traffic at its peak. Knowing when and how traffic will peak is nearly impossible, which means organizations must sometimes scale up far beyond what they traditionally need, to accommodate any spikes in traffic. Alternatively, not scaling means downtime or crashes when traffic surges occur.

Companies that do scale up find that most of the data storage and processing goes to waste the majority of the time, even though it costs thousands of dollars to spin up new servers. The timeframe for spinning up new servers can also take weeks, creating delays in new product launches and hiccups in serving existing customers. Payments companies must find a solution that can quickly scale up or down, depending on customer traffic demands.

Security and Compliance

PCI compliance and adherence to other regulations are mandatory. Payments companies must keep systems and customer data safe from breaches, fraud, and other attacks. FinTech, financial services, and payments are heavily regulated, making it essential for companies that fall under these umbrellas to find technology partners that are compliant with all the necessary regulatory bodies’ accreditations and to follow current ISO standards for data security.

Keeping Up with Innovation

Managing and maintaining infrastructure is a huge drain on IT resources. On-premise IT systems allow payments companies to shift the burden to the cloud while still securing systems and controlling compliance. This shift facilitates a greater focus on strategy and innovation so organizations can remain competitive in a crowded industry.

Why Amazon Web Services (AWS) Works

One of the biggest opportunities for companies switching to AWS is the shared responsibility element for security. AWS handles the security of the IT infrastructure that creates the engine room of the cloud. Payments companies can then control security around customer data in the cloud using AWS tools like operating systems, firewalls, encryption, and Identity and Access management (IAM). Further, AWS continues to update security measures without any additional investment needed from the client side.

AWS offers a unique value proposition to FinTech organizations migrating to the cloud. In an industry that is constantly in flux and where regulations evolve all the time, de-risking business models is imperative and often requires a hand-in-hand effort with regulators. AWS supports this type of collaboration and can provide the necessary tools to ensure the highest levels of security at all times.

Scalability is a given with AWS, allowing clients to configure computing resources and data capacity as needed and quickly. Users can log into the account and adjust parameters in a matter of minutes to accommodate peaks in traffic. AWS Elastic Computing (EC2) has a Service Level Agreement of 99.9% instance availability, globally. Backup servers are ready and able to pick up the slack in case any others go down.

AWS handles the heavy lifting of IT in several regards, including encryption, strength of firewall, and compliance with international security standards. With client IT teams freed up, they can focus on strategic business initiatives that add value.

Scaling up with AWS

Perhaps most importantly, the cost structure is far more favorable. As a service, AWS operates on a pay-for-what-you-use basis, so clients can scale up and down without overpaying for unnecessary hardware and server management that they won’t use outside of peak seasons.

FinTechs considering making the switch from on-premise servers to the cloud should consider what AWS can offer. The compliance and security benefits alone make a compelling case to migrate, though the ability to quickly scale up without unnecessary costs is also an appealing factor. Cloud is the future for payments, and AWS is a step in the right direction.

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