By Abhijit Banerjee, Managing Director, SolarWinds India
Staying compliant with regulations is paramount and challenging in the world of banking. Globally, financial institutions are adopting innovative observability solutions to ensure data integrity and transparency, and thus stay compliant with regulations. Indian banks and financial service providers are no exception.
The compliance challenges
The regulatory landscape is ever-evolving. For banks, navigating this landscape while processing massive amounts of data is a herculean task. Failure to comply will have great consequences, including hefty fines, reputation loss, and legal actions. Banks and companies providing financial services are increasingly turning to observability solutions to mitigate these risks.
The central regulatory authority oversees various compliance areas, including anti-money laundering, know-your-customer, capital adequacy, data security, and consumer protection. Just in 2022-23 alone, the Reserve Bank of India (RBI) has acted against 205 entities and issued a fine of Rs 40 crore.
Mission Critical to Untangling the Web
Principally, a bank or financial services company is expected to track its online activity and keep an eye on its IT systems to accomplish the following:
Compliance with the payment card industry data security standard (PCI DSS): Ensuring compliance needs are met by offering fuller visibility into both on-premises and cloud-based applications and systems. The PCI DSS is a set of security standards designed to ensure that all companies that accept, process, store, or transmit credit card information maintain a secure environment.
Detect, track, and handle security incidents: Identify and investigate potential security breaches and threats, executing countermeasures when needed.
Configuration management: Allows banks and financial services companies to monitor and audit changes made to device configurations. This visibility into configuration modifications helps quickly identify unauthorised changes.
User access monitoring: Enables real-time monitoring of user activities, allowing an organisation to promptly detect and respond to suspicious behavior, potential security threats, or unauthorised access attempts.
As operations and activities grow with the increasing number of systems and applications, it becomes nearly impossible to effectively track online activity and monitor using various tools. When you add the long and ever-changing regulatory compliance checklist to this complexity, IT teams in these companies start to see the value of a comprehensive observability solution that gives a complete view of everything.
Observability means closely watching and understanding how an IT system works in real time. It gathers information from different parts of the system, like networks, servers, and databases. This helps the IT team quickly figure out what’s causing a problem or failure. It also helps improve performance, and availability and reduces the time needed to fix issues in both on-site and multi-cloud setups.
An effective observability solution with built-in intelligence can identify and resolve common IT issues. These include detecting anomalies, assisting with root cause analysis, and predictive capabilities to assist in capacity planning, optimisation, and automating routine tasks. For banking and financial services companies, this means to ability to monitor critical processes and operations, leading to a more responsive and proactive approach to compliance.