Debunking Three Myths About the Cloud for Credit Unions
Even though it’s been around for quite a while, cloud computing still suffers from a few common misconceptions. There are three myths in particular that need to be debunked. Moving to the cloud, for credit unions, is more a matter of when, not if, and it’s best to know what you’re getting into.
The three myths that we hear most often regarding the cloud for credit unions are:
- It costs too much money
- Losing “control” of the data makes it less secure
- IT staffing will need to change
While those concerns are certainly reasonable, the reality is that none are particularly valid. In this blog, we’ll look at each of the three myths and explore reasons why credit unions shouldn’t fear them—or the cloud.
Myth #1: The Cloud Costs Too Much Money
Looking at the prices for various cloud hosting services can sometimes be startling. It’s easy to balk at the pricing structure for cloud services—they certainly do sound expensive.
However, cloud pricing only tells part of the story. The real trick that credit unions must remember is that they’re balancing capital expenditures and operating expense. When you consider the total cost of running an on-premise network vs. that of the cloud for credit unions, the numbers don’t look so bad.
Why the Cloud Doesn’t Cost as Much as It Seems
For example, when you need to encrypt your storage on Amazon, encryption is simple. All you have to do is click “next” three time, and voila! Your drive is encrypted.
On the other hand, credit unions running on-premise encrypted storage will have to pay hundreds of thousands of dollars to set up their system. Then, three or five years down the line, they have to buy another SAN.
Both expenses end up being pretty even. When moving to the cloud, you don’t have to invest in infrastructure. Instead, you trade your capital expenditures for operating expenses. Operating expenditures make your monthly payments go up, but it’s offset by:
- Easier budgeting
- More predictable expenses
- No massive cash outlays every few years
Instead, maintenance and support are baked into the operating costs of the cloud.
Myth #2: The Cloud Isn’t Secure Enough
Many people—including some IT professionals—are skeptical about credit union cloud security. Some professionals still don’t trust a system that they can’t physically see or touch.
However, data security is more about managing and restricting access than about where the physical storage location is. Control doesn’t necessarily equate to higher security.
Proper firewall and security suite configuration plus active security management are far more important than physical server control for protecting the integrity of your data.
Additionally, the cloud for credit unions offers fast, efficient access to and adoption of new technologies. Instead of paying for new security features and upgrades, the cost of those things is wrapped up in the cost of the cloud platform.
Myth #3: IT Won’t Have Anything to Do
IT will always have plenty to do. It’s basically part of their job description (item #6: will have many tasks always).
But seriously, the IT burden doesn’t just magically lift after offloading some data and infrastructure management to the cloud. Plus, IT is still responsible for server management even though the servers live somewhere else.
Also, IT still has non-cloud-related tasks to complete. With the time they save by not actively managing physical servers, IT staff can begin working on the business side of things. It’s not often that IT and business interests align, and magical things happen when they do align. For example, IT can move forward with member-facing services that they wouldn’t have time to support otherwise.
TL:DR Conclusions
Most of the concerns that credit unions have about cloud services can be easily dispelled. Not only does the cloud not cost as much as it sounds like, but it’s also more secure than most on-premise systems. Finally, the staffing implications of moving to the cloud are actually positive. Instead of focusing on maintenance, IT can work on member-facing initiatives that provide even more value to the credit union.
We update our blog weekly with more credit union-specific topics. If you’d like to learn more about the cloud for credit unions, information security, or business continuity planning and disaster recovery strategies, follow the links below!
3 Tips for Maintaining Credit Union Business Continuity Plans
Credit Union Business Continuity Planning vs. Disaster Recovery: What’s the Difference?
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