From service outages during peak demand to the constant threat of cyberattacks, the need for robust, dependable and flexible systems has never been more pressing for global banks and financial institutions.
Yet many long-established financial players find themselves hampered by outdated systems that are struggling to keep pace with the demands of a digital-first world. For these banks, legacy infrastructure can often act as an anchor, limiting their agility and ability to quickly adopt new technologies and meet shifting customer expectations.
Jason Cao, CEO of Huawei Digital Finance BU
With the rise of fintechs and digital-first players, the pressure on traditional banks to adapt has only increased. At Gitex Global 2024 in Dubai, one of the world’s biggest tech events where leaders gathered to discuss the future of digital finance, Jason Cao, CEO of Huawei Digital Finance BU, highlighted to The Fintech Times the core challenges facing established banks.
“Incumbent financial organisations and banks have to embrace new technology, but their main challenge is dealing with huge legacy systems,” he explained. “It’s very different compared to a new digital bank – there, it’s much easier.”
Banks need help to ‘run, change and disrupt’
Huawei has been at the forefront of helping financial institutions tackle these modern challenges. With experience serving more than 3,700 financial customers across over 80 countries, including 53 of the world’s top 100 banks, it has established itself as a go-to partner in digital transformation.
According to Cao, financial institutions must balance three key objectives to succeed: running day-to-day operations securely, transforming to stay competitive, and, in some cases, disrupting their traditional models to remain relevant in the face of fintech competition.
“Banks have two directions,” Cao said. “One is running the bank – daily operation, security, stability. You have to keep everything safe and stable. But another part is changing the bank – introducing innovation, transforming systems.”
With new threats and rising customer demands, banks also need to rethink their resilience strategies. “Even five or 10 years ago, running the bank was different. Now, you have many more transactions, new threats, and more complexity.”
Cao also addressed how traditional banking architectures, such as mainframes, are becoming obsolete in the face of cloud-native solutions: “Before, one machine was enough, but now we are moving from mainframe to cloud architecture. One machine turns into a thousand, and it’s more complicated to manage.”
Minimising downtime and latency
This is where Huawei’s tailored solutions come in. “We listen to where the bank wants to go, but they might not have the technology to get there,” says Cao, explaining that Huawei’s collaboration with banks begins at a product level, progresses to platform-level integration and can even expand into full digital transformation efforts with “Huawei’s step-by-step support”.
To help banks address these challenges, Huawei offers its ‘4 Zeros’ framework: Zero Downtime, Zero Wait, Zero Trust, and Zero Touch. This strategy is designed to tackle critical operational and security concerns faced by financial institutions.
Zero Downtime ensures that banks maintain uninterrupted services, even during peak demand. “You have to make sure whatever the time, the service is always on,” said Cao, highlighting Huawei’s focus on resilience.
Zero Wait is essential for banks to process transactions in real time, even during high-traffic events. For instance, during China’s Double 11 shopping festival held in November, transaction volumes can surge to 100 times the usual rate. “In the first minute of the sales, transaction numbers can grow by 100 times. Can you imagine how the bank has to run that? It’s a huge challenge. If the latency is longer, the transaction may fail,” Cao commented.
Huawei’s approach to achieving the Four Zeros involves a systematic process that spans from data storage and network infrastructure to AI-driven operations and security architecture. Its solutions ensure resilience through active-active data storage, seamless network connectivity and powerful computing resources, all essential for handling peak demand and maintaining uptime.
By blending AI with predictive maintenance and automated recovery, Huawei helps financial institutions minimise disruptions and optimise real-time processing.
Addressing security trends
As cyber threats become more sophisticated, particularly with the rise of ransomware, Zero Trust has become another crucial pillar of Huawei’s strategy. “Our anti-ransomware solution is very, very hot right now,” revealed Cao, reflecting the demand for secure, reliable protection across the banking ecosystem.
“It’s not just about one piece of technology but an entire strategy to protect every layer – from connectivity to data storage and processing,” Cao said, illustrating Huawei’s broad approach to cybersecurity.
Cloud and AI-driven transformation
Huawei’s work with financial institutions also involves helping them shift to cloud-native infrastructures. As banks increasingly move away from centralised, legacy systems, Huawei offers a migration strategy that blends hardware and software into a unified, cloud-driven platform.
“Transformation is not just adopting new, small technologies in certain areas; it’s a whole platform change,” said Cao.
Huawei’s GaussDB, a high-performance database, plays a critical role in ensuring real-time data operations and supporting mission-critical workloads.
In addition to cloud transformation, Zero Touch leverages AI to automate fault detection and system recovery. “We can now locate an issue within a minute and recover in three. AI ensures zero configuration errors, which is crucial for uptime,” said Cao. This AI-driven capability provides self-healing functions that enhance operational resilience, keeping financial institutions running smoothly.
Collaboration and ecosystem building
Huawei’s efforts to transform the financial sector go beyond technology. It works closely with global partners like Temenos, for example, supporting banks that use Temenos core banking on Huawei Cloud.
“No single player can solve these challenges alone,” said Cao. “We work with global and local partners to create specialised solutions that meet regional and industry-specific needs.”
Huawei’s AI4Data programme also enables financial institutions to harness real-time data insights, improving decision-making, customer personalisation and fraud detection capabilities.
A smarter, more resilient future
Huawei’s vision for the future of finance centres around leveraging AI, real-time data and advanced cloud solutions to support intelligent decision-making and operational efficiency, driving innovation across the financial sector.
“We see a future where banks not only become more resilient but smarter, adapting to both operational demands and customer needs,” concluded Cao.
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