Accelerate Business Value Realization with Finacle Banking Suite on AWS
By Venkat Raman R, VP and Head, Architecture – Infosys Finacle
By Shivaji Apte, Principal Architect and Head, Cloud Architecture – Infosys Finacle
By Dinesh Shetty, Principal Product Architect, Cloud Architecture – Infosys Finacle
Core banking systems have been around for decades as the backbone on which the world’s financial infrastructure is built on. While not as visible as other fintech systems, core banking is nonetheless central to banking services and is mission-critical software.
As digitization rewrites the future of banking, traditional core systems are falling short. Transactions are increasingly moving to the digital realm, and banks find themselves looking at the mammoth task of processing thousands of transactions per second, particularly during seasonal spikes.
Added to this, growing non-traditional competition is resetting customer experience benchmarks. Banks of all sizes are increasingly looking to cloud technologies to overcome these challenges. With cloud, banks can personalize their services at scale and rapidly design, test, and deliver engaging experiences to customers.
However, legacy core systems can hinder progress. To derive the full benefit of cloud computing, banks need a modern, digital, core—one that is purpose-built for the cloud.
Finacle is a leading digital banking solution suite from EdgeVerve Systems, a wholly owned product subsidiary of Infosys, which is itself an AWS Premier Tier Services Partner with the Financial Services Competency. Today, banks in over 100 countries rely on Finacle to service more than a billion consumers and 1.3 billion accounts.
In this post, you will learn how Finacle’s digital banking solution suite on Amazon Web Services (AWS) brings the full benefits of the public cloud to banking. It delivers business agility, lowers total cost of ownership (TCO), automates intelligent operations, and accelerates ecosystem innovation.
Finacle’s Cloud-Native Core Banking Solution on AWS
Finacle offers a cloud-native core banking solution that can be deployed flexibly—on a private, public, or hybrid cloud—to suit any bank’s requirements.
Finacle’s solution suite and software-as-a-service (SaaS) helps banks maximize digital engagement, enable innovation and growth with agility, drive operational excellence, and accelerate digital transformation with confidence.
Figure 1 – Scale digital transformation with Finacle on AWS.
Finacle’s cloud-native architecture leverages all the capabilities of managed services on AWS:
- Containerized microservices: Finacle consists of a number of microservices, each independently deployable, scalable, and taking care of one main concern. These are orchestrated on a CNCF standard Kubernetes platform—Amazon Elastic Kubernetes Service (Amazon EKS). The microservices can automatically scale-out or scale-back in response to traffic, and the underlying infrastructure can also scale using auto scaling groups.
- Service mesh: Istio service mesh orchestrates all inter-service communication as well as ingress and egress, delivering security, traffic routing, engineering, policy enforcement, and deep observability via Prometheus integration.
- Managed-backing services: All of the backing services—be it database (Postgres or Oracle), caching (Redis), or search—can be realized through the native managed services on AWS, including Amazon Relational Database Service (Amazon RDS), Amazon ElastiCache, and Amazon OpenSearch Service.
- Storage: All data in-out use cases in Finacle support Amazon Simple Storage Service (Amazon S3) object storage, which is extremely reliable and can scale infinitely while being widely accessible from multiple points.
- Leveraging Spot instances: Finacle batch services can fully utilize Amazon EC2 Spot instances for scaling the soft and non-real-time use cases. Batch services are resilient to Spot interruptions and can quickly respawn the replacement pods on available resources. A large number of EC2 instance types can participate in spot scaling, delivering significant cost savings on compute.
- High availability: All Finacle microservices are stateless. With a minimum of two replicas running across the EKS cluster stretching across two or more AWS Availability Zones (AZs), this provides high availability at the application layer. In the event of pod, node, or AZ failure, the application continues to be available and within a few seconds, the full capacity is regained automatically. Similarly, Finacle supports RDS in multi-AZ deployment mode, making for high availability at the database layer.
- Security: Finacle utilizes the Kubernetes-native Secrets interface to allow clients to fully manage sensitive data like private keys, certificates, cryptos, passwords, and passkeys in secure systems like AWS Key Management Service (AWS KMS) or an external vault while utilizing a run-time access to these during application initialization.
Figure 2 – Finacle deployment architecture for AWS.
Agility for Innovation-Led Growth
Agility is a key transformational virtue in today’s fast-changing banking landscape. Banks need to be able to rapidly design, test, and deliver products and services. They also need to personalize their services at scale. Containerized Finacle deployment helps banks with faster development, testing, and roll-out of business services.
Greenfield, Deploy Application Anywhere
Containerized Finacle deployment is completely automated and can be completed within hours. New features or business services developed can be tested and deployed in production in short time with continuous feedback from all stakeholders—end users, developers, business, and product owners.
AWS services like Amazon EKS, Amazon RDS, and Amazon ElastiCache can be provisioned and decommissioned dynamically for application development and testing.
Continuous integration and continuous delivery (CI/CD) automates the provisioning of AWS infrastructure and services for testing and production environments, and enables management and monitoring of the application and infrastructure. It helps development teams to detect and fix bugs quickly, and launch feature updates faster in the production environment.
Containerized Finacle can be integrated with standard DevOps tools, scripts, and templates to automate the build, test, and deploy processes. This results in shorter time to market, reliable release, improved code quality, and better maintenance.
Agile Innovation and Shorter Time to Market
Customer-centric organizations focus on delivering improved services and experiences to customers through constant feedback and innovation. Business and research teams provide feedback to IT teams to build new features and services.
To achieve this, teams require access to new hardware and software to build and test the prototypes. In public cloud environments like AWS, the complete infrastructure required for application developers can be built and destroyed in minutes using DevOps tools.
Containerized Finacle makes it easy to build and launch new features and services in the market. Automated pipeline helps IT and business teams continuously work on new ideas, and launch them in market ahead of competition with optimized cost on the infrastructure.
Reduction in Total Cost of Ownership
Among the reasons why banks should prioritize cloud adoption, total cost of ownership reduction grabs a spot in the top bracket. With cloud, banks can free themselves from the burden of managing servers and networks and, thus, save the capital expenditure of acquiring hardware and software for on-premises data centers.
Leveraging managed cloud services helps banks further reduce operational expenditure including people, license, support, and maintenance costs.
With containerized Finacle deployment, banks will be able to optimize their cost and investment by adopting AWS managed services, EC2 Spot instances, auto scaling on demand, and similar levers.
AWS managed services reduce upfront infrastructure and maintenance cost, and provide overheads for alert and monitoring configurations. A managed service lowers TCO by reducing cost as service adoption increases.
Finacle consumes managed services like Amazon RDS (database), Amazon ElastiCache for Redis (caching), Amazon OpenSearch Service (log analytics), and Amazon EKS (Kubernetes clusters). This helps with the need to install and configure underlying machines, upgrading and patching regularly, backing up, and setting up replicated instances for high availability.
Pay as You Consume, No Peak Sizing
Containerized Finacle can be deployed to scale dynamically based on business growth. Traditionally, for core banking implementations, infrastructure was procured for future growth (3-5 years) and always sized for the peak usage to meet multiple SLAs.
On AWS, underlying infrastructure for Finacle will be provisioned for the current business requirements and in the future on a dynamically scaled basis to handle 1) increasing number of end users, 2) spikes in API usage 3), batch workloads, and 4) spikes due to increased business activity.
Operational Non-Prod Resource Optimization
Deployment of containerized Finacle is completely automated. Non-production environments like Dev, UAT, SIT, and Performance Test can be deployed, scaled, and destroyed rapidly on demand.
Overprovisioning of IT infrastructure like software, hardware, and support to manage the application hosting can be eliminated and managed more efficiently. Infrastructure can be shut down during non-working hours and weekends which can reduce costs significantly.
Amazon EC2 Spot Instances
Spot instances are offered with up to 90% discount in comparison with On-Demand prices without making any term-based commitments. Finacle batch framework is designed to deal with EC2 Spot interruptions and can auto scale and optimally execute the workload on EC2 Spot instances, delivering significant reduction in infrastructure costs.
Automated, Intelligent Operations
Being large, mission-critical systems, core banking consists of several independent components or modules running together and integrating with a large number of other internal systems, as well as external systems like payments gateways, ATM switches, ACH/NACH systems, card networks, and merchant networks.
Traditional static deployment models tend to be difficult to patch and upgrade, and are peak sized to cover for the largest foreseeable spikes in traffic.
Finacle has a microservices-based architecture and supports full containerization along with public clouds like AWS. This provides significant operational automation, simplification, robustness, and scale.
Containerization enables the bundling of all binary dependencies into the images, and any service interactions are with clearly-defined external service endpoints. This separates the application layer from the underlying host software.
The hosts are compute instances (EC2) that can be provisioned on demand in a matter of minutes.
AWS makes available up-to-date operating system images (Amazon Linux) with all security patches. These can be used immediately as the container-kernel interface ensures full compatibility.
Banks can adopt the continuously evolving infrastructure—ever more powerful, higher performant, and lower cost—as AWS continues to innovate its compute offerings.
Automatic Scale-Out and Scale-Back
This enables rapid adaptation to changes in traffic volumes without having to be sized for the theoretical peaks all the while. Typically, the peak size is anywhere from 3-5 times the average load for any deployment. Hence, moving away from peak sizing to just-in-time auto scaling is a significant benefit.
Each container is sized for some standard units of concurrent work for its service, and they can be rapidly scaled horizontally (N-times) to meet any traffic demand.
Scale-out can happen based on a multitude of appropriate criteria like CPU, memory, or number of concurrent requests per second.
At the host level, EC2 auto scaling groups scale automatically the underlying compute and memory pools required for the desired application scaling. The same mechanism allows the entire setup to scale-back when traffic recedes.
Application containers scale-back and this reduces the load on the underlying EC2 infrastructure. The auto scaling groups respond in turn by scaling back the number of instances deployed.
Real-time observability is the key to enabling just-in-time application scaling, auto healing, and automated operations.
Finacle employs a robust intercepting architecture and offers real-time observability, which provides information on health in addition to state of the application and key business and technical metrics. All AWS managed services provide rich and near real-time metrics.
Robust Business Continuity
This is crucial and both high availability and disaster recovery have stringent SLAs. By adopting the cloud model, it’s simpler and more economical to design the deployment to meet the required availability.
At the core of this architecture is immutability and replaceability. In case of any issue, it’s faster and simpler to discard an application container and spin off a new one. This reduces the blast radius of any hardware or lower-level failure at each level of the application stack.
Since the deployment is based on a large number of small-sized container units, the application itself remains available even though the performance may reduce in the face of such failures.
Just as application units are replaceable, the host infrastructure of compute nodes is also stateless and replaceable. In case any node fails, the application containers are automatically shifted out to a new node that’s instantiated. All of this happens automatically and without needing human intervention.
Consumption of a number of AWS managed services means the overall responsibility of high availability is effectively split. You need only to worry about the application stack, while the underlying infrastructure, network, storage, and any managed services availability is taken care by AWS.
A multi-Availability Zone configuration allows both:
- Backing services like Amazon RDS to be highly available in the face of local or even AZ-level failures with an automatic failover to another serving instance in another AZ.
- Effective distribution of application stack across AZs and auto scaling means an application is not vulnerable to local or AZ-level failures and remains available and adapts to scale in the other AZs.
In the case of any catastrophic failures or natural disasters, the core banking system is expected to be resilient and available within a space of a few minutes. A robust disaster recovery (DR) architecture can be implemented combining Finacle cloud-native capabilities along with AWS capabilities.
Again, the concept of immutability and replaceability comes to the fore, as a full-fledged deployment at the DR region can be brought up in minutes—starting with the underlying compute infrastructure and then the application stack.
In fact, the DR region requires a minimally-sized application deployment all through the operations. When DR is invoked, the application and infrastructure automatically scales itself up to the required level of traffic in a matter of minutes.
Accelerated Innovation with Ecosystem
The pace of innovation is accelerating rapidly and increasingly rides on a large ecosystem of collaborators. You can solve the most critical problems in your domain if you can build on top of the best solutions that are auxiliary and complimentary to your core.
By being fully cloud-native, Finacle leverages a large number of innovations as well as complementary services that are offered by AWS or the marketplace.
Hardware Innovation with Nitro and AWS Graviton
AWS has been innovating at the hardware layer with the AWS Nitro System and AWS Graviton (ARM-based processors) for the core compute and network infrastructure. The sixth generation of instances include the Graviton-based instances which provide significantly better value at unit price.
Moreover, many AWS managed services like RDS, Amazon ElastiCache, and OpenSearch Service are now available with a Graviton-based option.
Evolution of Database as a Service
There is tremendous innovation and evolution happening in the database-as-a-service space. Since databases are at the core of any transaction and financial processing platforms, this is a key source of innovative advantage for banking platforms.
The ability to scale out the database, the consumption-based model of Amazon RDS, and the ability to quickly spin up a vertically scaled instance for DR as needed are key benefits.
AWS also offers Amazon Aurora, a PostgreSQL-compatible, fully managed, relational database service built for the cloud. Aurora PostgreSQL is fully compatible with Finacle and provides higher uptime SLAs. Thus, cloud-based deployment enables simplified operations and lower TCO at the database level.
Log Analytics and Search
Large banking platforms, with their high transaction rates and multiple external integrations generate massive logs and traces. Being able to ingest, analyze, and correlate these logs in near real-time and provide troubleshooting, dashboarding, and analytical insights is an advantage for both the technical and business operations of the platform.
Finacle on AWS integrates with OpenSearch Service to deliver the full potential of near real-time log analytics. Logs from the application layer, platform layer (containers, pods, nodes, database, queues, caching, and HTTP request processing) as well as the infrastructure layer—compute, storage, networks—are all ingested in real time into OpenSearch Service.
Rich analytics dashboards provide near real-time analytics, interactive troubleshooting, and operational insights, enabling a rapid response capability. This covers both the technical and business parts of the platform operations.
Furthermore, a flexible set of archiving operations are available to send the data to any or all of data lakes (Amazon S3) and long-term archival storage (Amazon S3 Glacier).
Hybrid Cloud with AWS Outposts
Hybrid cloud is an important deployment model for some segments and geographies due to a mix of regulations (primary location of data) and tight low-latency integrations with other enterprise systems.
In such situations, AWS Outposts provides a way to run key platform modules on a slice of AWS but co-located at the client’s data center. This provides the same access to key AWS managed services (especially compute, storage, and database) in the local data center.
Finacle is fully compatible with this deployment model and opens up the possibilities for clients where a pure-play public cloud adoption is not possible.
Finacle’s modern cloud-native architecture on AWS offers a compelling option for banks to move to the cloud. AWS managed database services provide simplified operations, excellent performance and scalability, and robust high availability at reduced costs. Amazon EKS along with Istio service mesh provides a robust, self-healing, auto scaling, low maintenance setup of containerized Finacle.
Leading banks across the globe are leveraging Finacle’s digital banking solution suite on AWS and reaping the benefits of business agility, lower total cost of ownership, operational efficiency, and accelerated innovation.
To learn more about Finacle’s digital banking suite, please visit Finacle.com.
The content and opinions in this blog are those of the third-party author and AWS is not responsible for the content or accuracy of this post.
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