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Financial services and financial technology (FinTech) companies often depend upon complex infrastructure to handle their financial data. Security and compliance are paramount for these organizations, for gaining full visibility into the health and performance of these services to guarantee security is essential.
However banking, FinTech and other financial services have evolved in recent times, particularly seen with banking as mobile banking has become the standard, which has led to a reduction in physical branches on the high street.
Therefore, these organizations require a solution so they can attain complete visibility into the health and performance of services, and conduct the investigation of production issues via examining and correlating logs, metrics, and trace data. As well as this, they need to ensure that their data and services are secure and adhere to all relevant compliance regulations. While also being scalable to adapt to the changes within the industry to allow the organization to remain competitive.
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What is Observability?
The classic definition of observability is the extent to which internal states and operations of a system can be inferred from its external outputs. Put simply, it’s the measure of how accurately you can comprehend what is occurring within a system based on external information.
Observability incorporates tools, practices, and methodologies utilized to attain insights into the behavior of a system. It entails monitoring multiple components of the system, such as logs, metrics, traces, and various other data points. To understand its performance, find issues, and troubleshoot problems.
How Observability Can Empower Financial Services
Utilizing the potential of observability in the financial services industry can streamline your operations and provide a whole host of benefits to your organization. To help you comprehend the variety of uses and scenarios that observability can assist within your organization, we will outline a variety of use cases for the solution within this industry.
Mobile Banking and Security
Banking is shifting to more users utilizing mobile banking applications to conduct their banking activities rather than visiting physical branches. This has occurred to the extent that there are now numerous banks that only operate digitally, with no physical branches. This increased use of mobile banking apps means that it’s imperative for these companies to guarantee the security and availability of their applications.
This can be achieved by using an APM (application performance monitoring) tool, which is available through the Logit.io observability platform. With an APM tool, you can gain deep insights into your application and use user behavior data for unusual or anomalous activities. You can benefit from identifying the root causes of reduced performance or crashes, monitoring specific events and actions, viewing the stack trace for specific errors, and many other powerful advantages.
Transaction and Distributed Tracing
Tracking transactions throughout the entire lifecycle is a vital part of any financial organization's activities. Additionally, with the complexity of the IT architecture used here troubleshooting can easily become difficult and tiresome. Therefore, utilizing distributed and transaction tracing can aid in simplifying these processes.
Executing distributed tracing adds a traceable ID that makes it possible to comprehend the flow of execution between microservices. This paired with transaction tracing enables your organization with debugging, performance analysis, and behavior analysis. Supplying a more in-depth view of your microservices and their interactions.
Financial Services IT Operations
Financial services IT operations have always been some of the most demanding of any industry. Their operations as well as others, include a large customer base, global operations, challenging security environment. This creates the challenge of managing this environment with complex service-level agreements and the necessity of almost 100% uptime in a high-security environment.
Incorporating an observability solution here will significantly aid the challenges of this IT environment. Your organization would have the ability to monitor various systems in real-time and establish correlations via thousands of data feeds. The insights gathered in real-time can be leveraged to inform and drive decision-making processes.
Financial Crime
In today's world financial crime is continually rising, and malicious individuals are constantly devising new methods to exploit weaknesses in financial services systems and applications. Therefore these organizations need to take proactive measures to guarantee the security of their IT infrastructure and be able to monitor the activity of these systems and applications to find and fix potential areas of weakness before they can be exploited.
Financial services can gain significant benefits from monitoring the security of their IT infrastructure. Proactively identify intruders by automatically highlighting anomalous activities and threats. Also, by conducting a unified search, alerting, and reporting on your data from your entire traces, this enables you to simply monitor critical events on your network.
Insider Threat Detection
Banks and financial services need to be able to identify areas or employees of concern. Utilizing analytics financial firms can conduct preventative measures in the form of modifying internal controls, training, and introducing new rules and procedures.
For detecting insider threats, organizations can employ dashboards via an observability solution (such as the one provided by Logit.io) to supply visibility on common user activities that may suggest risky behavior. Also, financial firms can utilize employees' login data to correlate with IT systems to determine if employees have accessed systems during the same time as a threat or malicious activity was conducted.
Anti-Money Laundering
Global money laundering is estimated to be at 2%-5% of global GDP. Yet, outdated anti-money laundering systems are currently impacting the amount of this that can be seized. Recently, banks have been seen to have faced criminal charges and heavy fines for having inadequate checks on customers and failing to investigate suspicious transactions.
However, Logit.io’s observability platform can aid your organization in fighting against money launderers via its data analytics platform that centralizes and attains insights from data. This supplies companies with a holistic view across data sources that have relevance to money laundering. This is possible without your teams requiring programming skills so they can quickly begin searching, correlating, and visualizing data.
Sanctions Compliance
Increased globalization can complicate the ability of financial services companies to comply with sanctions administered in various jurisdictions. This heightens the risk of sanctions violations occurring. So, these organizations are expected to highlight suspicious transactions and utilize adequate controls, checks, and balances on customers to highlight sanctions violations.
Hence, observability solutions can assist organizations within this industry by correlating both structured and unstructured data. They provide a mechanism for conducting free-form text searches, allowing for the rapid identification of screen names associated with known or suspected targets.
Below is a table detailing more use cases of observability for financial services and Fintech organizations.
| Use Cases | Description |
|---|---|
| Branch Banking | Utilize an observability solution to gather information directly from devices within the branch, supplying more comprehensive insights into customer journeys and employee behaviors. |
| Profitability and Sales Performance Analytics | With an observability platform, you can use operational dashboards to show how sales teams are performing and highlight areas for improvement. |
| ATM Operations and Security | Attain a holistic view of your ATM network by incorporating an observability solution into your organization. ATMs produce telemetry data making it simple to know the status of a specific ATM. |
| Data Exfiltration | Utilize security analytics as part of an observability solution to Implement an array of data-driven strategies to find and counter data exfiltration attempts. |
You can find out more about the capabilities of the Logit.io observability platform for financial services and FinTech organizations by reaching out to a member of our team or by signing up for your free 14-day trial.
If you’ve enjoyed this article why not read APM vs Tracing vs Observability or our Beginners Guide to Observability next?