Absa Group provides banking and financial services to 9.7 million customers across 12 African countries, and also operates local offices in the UK and US. When it was sold by its parent company, Absa saw an opportunity to modernize its technology estate by moving its on-premises data centers to the cloud. The organization wanted to improve the reliability of its systems and applications, innovate around risk management, and reduce rising compliance costs.

Because its existing IT setup was so extensive, Absa decided it would be too complex to move all its systems to the cloud at once. Through partnership with Amazon Web Services (AWS), it began by migrating high-priority systems first. This included a mission-critical financial crime application required to meet compliance obligations for customer onboarding.

Building the application on AWS made it easier to scale across the continent and brought greater efficiency to the development process. It also improved availability, so customers could instantly and reliably sign up for products and conduct transactions. In addition, migrating to AWS cut the cost of preventing and reporting financial crime by 5 percent, and increased Absa’s competitive advantage by allowing the team to quickly deploy new capabilities. Absa has migrated 11 of the 12 African countries it operates in to AWS, with the final country currently undergoing regulatory approval.

Absa’s financial crime reporting application allows it to fulfil the various compliance obligations in the countries where it operates. In South Africa, for instance, Absa must comply with the Financial Intelligence Centre Act (FICA). This requires the organization to conduct identity checks on new customers to help counter crimes such as money laundering and terrorism financing. The application automates the necessary checks on new account holders and informs regulators of possible criminal activity.

Absa uses the AWS Africa (Cape Town) Region and its three Availability Zones to serve customers, with Elastic Load Balancing (ELB) automatically distributing incoming application traffic across multiple targets and virtual appliances. It ensures the application is available for customers using Amazon EC2 Auto Scaling to add or remove compute capacity to meet changes in demand.

Customers now have a better experience opening accounts because the reliability and performance of the application has improved. “The AWS platform is more resilient and means we can scale quickly, which are very valuable benefits to the firm,” says Nic Swingler, Head of Financial Crime for Africa at Absa.

Absa can now fix issues and test new functions for the application without putting other business functions on hold.

Previously, it had to shut down other processing tasks because it had a limited amount of compute power available. Now Absa can dynamically ramp up compute resources when it needs them, such as when it conducts large-scale testing of the application’s new features.

Absa runs test environments on AWS that allow it to work on releases, with the ability to instantly roll-back if there are any problems. This makes upgrades easier and faster, and the customer experience more consistent.

Absa‘s improved systems mean it can be proactive in detecting financial crimes and reducing risk. This has allowed a strategic shift by making financial crime an element of risk management rather than a standard compliance issue. “Viewing financial crime detection as risk means we dive deeper into our data and spot anomalies in customer behavior to manage our risk profile,” says Robert Benvenuti, head of Compliance Change, Transformation and Data at Absa. “This takes us beyond the usual rules-based approach to compliance and moves us to a more behavior-based approach.”

The move has cut the organization’s annual spending on financial crime detection and helped it shift from capital to operational expenditure. “Such a substantial savings is brilliant, especially as the cost of compliance continues to rise on a yearly basis globally,” says Ridwaan Rasool, Head of Technology for Regulatory Functions at Absa, “However, we would likely have migrated to AWS even if costs were the same because of the added benefits, including the ability to innovate around our compliance and risk management activities.”

Running Absa’s database on Amazon RDS Multi-AZ Deployments provides enhanced availability and durability. The use of Apache Spark on Amazon Elastic MapReduce has performance benefits too, and makes it easy to manage Spark clusters. Batch runtimes are faster than with its previous on-premises setup, with millions of transactions ingested in minutes rather than hours. This provides real-time insight into the company’s performance and risk profile.

In future Absa plans to use data analytics run on AWS to provide insights for compliance investigators that will ease their workloads. The application will have an easy-to-use dashboard that automatically flags potential risks. This will help Absa investigators to make quicker and more accurate decisions on issues such as whether customers applying for accounts are who they say they are, or whether addresses and personal information are correct. Using analytics will also help to reduce false positives raised by the financial crime application, saving valuable time that staff previously spent examining these potential risks.