Conflux Technologies, based in India, developed Finflux, a software-as-a-service banking platform aimed at small to midsized banks and non-banking financial companies (NBFCs). The platform helps banks and NBFCs administer microloans to individuals and businesses.
Historically, small to midsized banks and NBFCs found microloans a challenge because of the cost of deploying and managing an on-premises infrastructure to administer the contracts. Nayan Ambali, cofounder of Conflux Technologies, explains, “They couldn’t build a sustainable business model because the expense of scaling an on-premises infrastructure to handle microloans outweighed the returns from the loans.”
In 2010, Conflux Technologies began building the IT infrastructure for Finflux on the Amazon Web Services (AWS) Cloud. “AWS offered us the stability and pricing we were looking for compared with other cloud providers,” recalls Ambali. “I had read a lot about the investment AWS was putting into its services and infrastructure, so I felt we would be working with a cloud provider that could help us develop and improve our services over time. Documentation on the AWS Cloud and working with its services were also widely available. It felt like the right choice.”
When Conflux Technologies developers built the Finflux banking platform on the AWS Cloud, they created an infrastructure to support Finflux Core, Finflux Web, and Finflux Mobility Solutions. Finflux Core takes data from loan applications as well as national and international credit bureaus, such as Highmark, Equifax, and TransUnion CIBIL. Finflux Core’s credit-decision engine processes the data to determine an applicant’s creditworthiness. The functionality in Finflux Core supports loan management including financial accounting, provisioning, business intelligence, analytics, and ongoing risk assessment, in line with local compliance regulations. Back-office banking personnel access Finflux Core via the Finflux Web interface, and loan officers use Finflux Mobility Solutions in the field for uploading loan applications, for example, and recording payment collection.
Developers built the application underpinning the Finflux platform using the Spring Framework running on Apache servers, hosted on Amazon Elastic Compute Cloud (Amazon EC2) instances. The Finflux platform uses Amazon Elastic Load Balancing to securely distribute data traffic among Conflux’s Amazon EC2 instances in the Singapore and US East Region. Says Ambali, “Amazon EC2 provides us with virtual servers that we can cost-effectively scale up as our customers onboard more loans.” The platform also uses Amazon CloudFront to optimize page-loading times for Finflux Web. “It means back-office banking personnel avoid problems with web page lags and can work efficiently,” comments Ambali.
The developers made Amazon Simple Storage Service (Amazon S3) the repository for loan documentation. Data from Amazon S3 goes into customer-specific Amazon Aurora transactional databases to support the credit-decision engine. Amazon Aurora—built for the cloud and up to five times faster than standard MySQL databases—currently handles around 3 million Finflux transactions daily. Ambali says, “More importantly, Amazon Aurora not only gives us speed but also security. This includes network isolation and encryption to protect each of our customer-specific databases.”
Data from Amazon Aurora is ingested by an Amazon Redshift data warehouse—currently storing 1.5 TB of data. “Our application takes the key business indicators from Amazon Aurora and moves them into Amazon Redshift, where customers use Tableau for data analysis,” comments Ambali. “Besides being cost-effective, Amazon Redshift is largely automated—reducing our number of management tasks.”
By adopting AWS Auto Scaling, Conflux Technologies has reduced Finflux’s IT costs by 40 percent. The business saw that transactions on the platform peaked around 10 AM during weekdays when NBFCs began printing daily reports. Transactions then peaked again in the evening from batched uploads. “AWS Auto Scaling means that as soon as a server reaches 90 percent utilization, another Amazon EC2 instance is brought up. We scale up and down as needed, maintaining the performance of Finflux and optimizing our IT spend,” says Ambali.
Finflux is compliant with financial services authorities in key markets such as India, Africa, and South Asia owing to the security built into the AWS Cloud. “AWS provides security services straight out of the box,” says Ambali. These include AWS Key Management Service (Amazon KMS), industry-standard encryption, and Amazon Virtual Private Cloud (Amazon VPC), which allows Conflux Technologies to isolate customer cloud infrastructures to support compliance.
To date, Finflux helps manage microloan portfolios worth approximately $2 billion and supports approximately 50 financial institutions across 15 countries. These institutions have seen 55 percent year-on-year growth in their microloan business. Says Ambali, “AWS enables us to support the rapid growth of our customers’ portfolios through its scalability and simplified management. For example, we have just one infrastructure administrator for our entire cloud infrastructure, so we never run the risk of IT overheads limiting our business expansion.”
To Learn more, visit https://aws.amazon.com/financial-services/.