February 08, 2022

global risk regulator

Cloud Service Providers Face Greater Regulatory Scrutiny

News that the UK’s Prudential Regulation Authority plans to more closely scrutinise the leading cloud service providers is the surest sign yet of growing regulatory concern about their growing penetration into the financial system.

UK regulators have been at the forefront of questioning the operational resilience of third party providers to banks. Now the Prudential Regulation Authority (PRA) wants to know more about the reliance of financial firms on the big three cloud service providers (CSPs), Amazon Web Services (AWS), Microsoft Azure and Google Cloud and their migration strategies if something goes wrong.

"I think the PRA is trying to clarify, and modernise what kind of regulatory oversight and risk controls would be suitable", says Marcus Hughes, director of business development at Bottomline Technologies.

The PRA has made no secret that it wants more powers to look into CSPs, Other regulators including the Federal Reserve have similar views...

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