PRIYANKA VERGADIA: Welcome to Build with Google Cloud, where
we build things, reference architectures that can help you
make your Google Cloud journey a little bit easier.
In this episode, we are going to see how you can build
a tiny bank on Google Cloud.
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So you are an organization that wants
to either build new or modernize traditional banking
products and solutions.
Where do you get started?
Well, stay with me to find out.
I'm Priyanka Vergadia, developer advocate here at Google Cloud.
And today, let's see what your options
are to build a modern digital banking
platform on Google Cloud.
Are you ready?
Let's go.
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Banks were born to help us manage our money.
Over the years, the value provided by the bank
has expanded from checking, savings, and personal loans,
with money transfer solutions and bill pays and rewards.
Sadly, these solutions feel disconnected even today.
It is time for a simpler experience
with deeper integrations into the bank
and each aspect of our lives so we
don't have to carry so many different apps on our phones
for utility, credit cards, and to manage our budget.
Another example is it is a common practice
for hotels and airlines to leverage banks
to create their own credit cards.
We should see a future where more services can
be offered via banking as a service model, which
is modular, cloud-native digital bank architecture that
offers financial products and services via APIs
and microservices.
Why modular?
Well, because value-added services on digital platforms
enable the bank to quickly adapt to emerging markets and demands
by measuring success and outcomes
and can allow them to build new products in a matter of days
and not months or years.
Now, another example here is banks
are able to easily provide e-commerce retailers
with a value-added service that offers instant loans
or buy now, pay later checkout options on their websites.
And the only way this is possible
is with a modular architecture.
So now that we know that we need a modular architecture,
let's see what it takes to get there.
Here are some of the API products
that are central to embedded finance, which
refers to core banking services, which
includes opening an account or checking balance and making
payments.
But managing these API products and services
has increased in scale, cost, and complexity
because the legacy architecture was a one-on-one mapping
between core banking system and the banking front end,
such as the website.
The modern banking as a service model
requires one-to-many mapping of the core banking microservices
with an API layer.
This new platform enables business transformation
by embedding and integrating core capabilities securely
with as many new systems and partners as needed,
such as airlines, utilities, transportations, and telcos.
I've already dropped some hints about how
you could start to build this modern banking as a service
platform.
Would you like to take a shot at some of the components
that you can start with?
Share with me in the comments below.
OK.
So now that we know what problem you're
solving when it comes to modernizing retail banking,
let's see how we solve it--
time to dive into the high-level components that we need.
A modern digital bank comprises of multiple business functions
and capabilities.
These logical components can be organized
into a few high-level categories.
Let's consider a fictitious financial institution,
Symbol Bank.
It has to have services across various channels
to serve the external customers.
These could include applications that directly
serve the customers-- the payments, the operation
services for onboarding, management, servicing, and then
the partner services.
Then comes the integration services,
which act as the interoperability and
connectivity layer for all the bank's services
and applications--
essentially, the technology glue that
brings the core platform data and various applications
together to orchestrate and provide a business
function for the bank to its users.
Then there are the data applications and platform,
which include the various data pipelines-- streaming,
processing, governance, and data warehousing
for applications and services.
The enterprise application services
make up the enterprise back office services
that keep the business operating and compliant.
Well, these include various foundational components
of the bank, like finance and treasury, financial ERP,
the governance, risk, and control,
the regulatory reporting, and audit and compliance.
Now, core application services are those core services
and applications and data that are required for a bank
to offer products and services to their customers.
These include the core banking data
models for sensitive customer information, transactions,
products, and things like that as well as all the processing
and persistence of that data.
Now, additional core services include card management,
payments, collections, and credit and fraud risks.
Then there are the infrastructure operations
and security components that apply to all functional aspects
of the bank's capabilities.
These are considered foundational components
to ensure the bank's customer data, integrity, and privacy
with appropriate controls and policies
that adhere to the bank's internal controls
and government regulations.
Now that we know what capabilities a bank
needs or offers, we are ready to dive
into the architecture to make this work.
Well, in this part of the video, we
are going to look at each of the segments of the retail banking,
one by one, from channel services, integration services,
data applications and platforms, enterprise application
services, core application services, and infrastructure,
security, and operations.
Channel services include services for customer channels,
such as banking and customer services,
using Contact Center AI and messaging.
Transaction channels, such as credit and debit payments
using Google Pay, and partner channels,
which is connecting with open banking
APIs and other marketplaces using Apigee API Gateway--
now, these services power the customer applications,
such as the ones needed for operations, onboarding,
management, servicing the customer,
showing customers the right ads, sales, marketing,
and loyalty apps.
Then you have the integration layer,
which comprises the API connectors on Apigee API
Management.
These connectors take the real-time and batch
unstructured and structured data and then pass it
on to the data science layer for further analysis
and creating unique user experiences, like personalized
recommendations and propensity models,
or preventing financial crime with fraud prediction
and anomaly detection with Vertex AI platform.
You can also run high-performance computing
workloads using Tensor GPUs within Vertex AI.
In addition, Vertex AI streamlines the IML pipelines
and provides explainable AI outputs and model governance.
Now, Event and Transformation Hub
also ingests the batch data through Cloud Storage
and real-time data through Pub/Sub messaging service
and passes it on to data flow for transformation
and orchestration.
The processed data is then sent to serverless data warehouse,
BigQuery, and metadata that is stored in Cloud Storage, which
is a data lake.
Other teams and applications can then
access this data through a unified data management
catalog, Dataplex.
As you can see, the data platform
enables the bank to securely process and store
sensitive customer data while enriching with additional data
sets to gain a better understanding
of their customers and products.
Then comes the enterprise application services
that make up the back office services,
which keep the business operating and compliant.
And these include various foundational components
of the bank, like finance and treasury, financial ERP,
visualizations, regulatory reporting, audits, compliance,
governance, risk, and control.
We query the data of a BigQuery and then
use it to generate visualizations in Looker.
Core application services are the core services
that are required for a bank to offer its products
and services to the customers.
Now, these services are typically
deployed as microservices on Kubernetes Engine
with transaction, products, and customer data on Cloud Spanner.
Event-driven microservices communicate with each other
using Cloud Pub/Sub.
Additional core services include card management
and payments and collections and credit and fraud risk.
Then there are the core security and operational components
that apply to all the functional aspects of the bank's
capabilities.
Now, these services include identity and access management
for authentication and authorization standards, data
locality, encryption and key management, data anonymization
and tokenization, along with system, network,
and application logs for access transparency and monitoring
incidents and SLAs.
I know, I know, that was a lot.
But don't worry.
I've linked a sample application code for you
that you can run as your own bank on Google Cloud.
Click and learn how it works.
And don't forget to share how it went for you.
We just looked at a reference architecture
to build a digital banking platform
on Google Cloud, the different components and Google Cloud
Services that you can use to build those components
or augment them.
Wherever you start, it'll be a success and great start
to gain agility in launching new features, innovation,
and improving customer experience
while keeping the data safe and using it to gain insights.
Now it's your turn.
Go build a tiny digital bank using
the documentation and full sample code repository linked
below.
If you liked this video, then I encourage
you to let me know by clicking on the Like and Subscribe
buttons.
Oh, and if you want to see me built a specific architecture
in this series, let me know in the comments below.
I cannot wait to build more stuff with you.
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