DevOps In Banking: What Are the Biggest Challenges?

Over 80% of financial institutions are embracing DevOps, known for its agility and quick changes. But can we truly always build robust software solutions prioritizing security and stability?

The financial sector operates at a unique pace where robust security measures, stability, and regulatory compliance are crucial for maintaining customer trust and financial integrity. Given this focus, some may question whether DevOps, known for its emphasis on agility and quick changes, aligns well with these priorities. Well, with its emphasis on collaboration and automation, DevOps offers immense potential for banks.

In fact, over 80% of financial services companies have already embraced DevOps practices, including major players like Bank of America, Barclays, HSBC, and Santander Bank. This widespread adoption underscores its relevance across the fintech industry. Yet, making it work effectively poses some challenges. What are these challenges, and what is DevOps in the banking sector really about? Read on to find out.

Key takeaways

DevOps in banking and financial services means aligning development and operations teams to deliver software more quickly, securely, and in compliance with strict regulations.
In a highly regulated and customer-driven environment, DevOps enables financial institutions to respond faster to market demands, improve delivery processes, and support continuous learning.
However, adopting agile and DevOps practices requires cultural change, strategic planning, and the ability to balance agility with risk management.

What is DevOps?

Is DevOps just a tool, or does it resemble agile methodologies like Scrum or Kanban? And if you’re using Kubernetes for deployment, does that automatically mean you’re practicing DevOps? Where does it even begin, and how do you know when you’ve fully embraced it? The truth is, DevOps can mean a lot of different things, depending on who you ask. This makes it somewhat complex, especially when considering that some “old-school” roles (such as sysadmin or network admin) simply transition to DevOps titles without a true shift in mindset and practices.

DevOps can be defined as a powerful approach that combines tools, practices, and a collaborative mindset. It automates and integrates the work of software developers and IT operations teams. This focus on teamwork, clear communication, and automation helps deliver software faster and more reliably. DevOps gained traction by encouraging teams to break down tasks, work together, and see the bigger picture through seamless collaboration. This transparency leads to faster, more reliable deployments and long term success.

The idea behind DevOps emerged around 2007. Back then, software development and IT operations often worked in isolation. Developers wrote the code, while IT operations handled deploying and maintaining it. DevOps—a blend of “development” and “operations”—bridges this gap by integrating these disciplines into a single, continuous process.

However, it isn’t a quick fix for everything. It’s not a readily available product or tool that can be implemented by fintech companies with a one-time effort. Moreover, it’s not the sole responsibility of a single engineer, nor is it just a change in job titles for existing development teams. While embracing Agile or Scrum methodologies can be complementary practices in a DevOps journey, they aren’t synonymous with achieving a DevOps environment. DevOps is much more than any of these things.

DevOps in the banking sector: How can it make a difference?

Truth be told, back in the day financial institutions weren’t exactly known for embracing change or digital transformation. This cautious approach is understandable, though. Implementing any innovation or new technologies in this sector requires navigating a complex web of regulatory requirements, especially those around data security.

However, the world of finance is constantly evolving, and customer expectations on banking services are higher than ever. To maintain a competitive edge, financial companies must be open to digital transformation and continuous improvement. Fortunately, this shift is underway. Over 80% of financial institutions are recognizing the value proposition, and are actively deploying DevOps practices. This is a clear sign that the financial services industry appreciates the efficiency gains DevOps brings to software development and operations. Following this trend, the global financial services DevOps market (DevOps software solutions and services) is expected to grow significantly, reaching a projected value of $25.5 billion by 2028.

The rise of DevOps in financial services also highlights how the industry is addressing the need for continuous integration, faster software delivery pipelines, and improved customer satisfaction.

The benefits of implementing DevOps practices in in financial services

Today, some of the major players in the banking industry like Bank of America, HSBC, Barclays or Santander Bank are adopting DevOps practices to reap a range of benefits. What benefits are there?

Faster time to market: DevOps streamlines the software development lifecycle, allowing banks to deliver new features and products to customers quicker. With this agility, fintech startups and companies can stay more competitive.
Enhanced security: DevOps emphasizes security throughout the entire development process, not just as an afterthought. This proactive approach, often enhanced by artificial intelligence solutions, helps banks minimize security vulnerabilities and protect sensitive customer data.
Improved collaboration: By breaking down silos and setting common goals and duties, DevOps fosters a culture of collaboration between development and operations teams. The result? Effective communication, reduced friction, and streamlined development process.
Improved operational efficiency: By automating repetitive tasks, day to day operations and reducing manual work, DevOps supports seamless operations across teams and systems. As a result, organizations can achieve cost savings, a more efficient use of resources and competitive advantage
Increased reliability: DevOps practices like continuous integration and continuous delivery (CI/CD) allow for frequent and controlled deployments. This reduces the risk of errors and supports minimal downtime during updates, which is especially critical for maintaining seamless financial transactions and service availability. As a result, bugs can be identified and fixed faster, leading to more reliable and stable applications.
Better scalability: DevOps supports scalable infrastructure and adaptable workflows that grow with business needs, helping financial institutions respond more quickly to market demands.
Enhanced customer experience: Faster software updates and more reliable and personalized digital services lead to smoother interactions across mobile apps and other banking platforms.

The biggest challenges of DevOps in banking

While the benefits of DevOps for financial services are clear, implementing it in the banking industry presents some unique challenges that need to be taken into consideration.

Legacy technology

Established banking institutions often rely on legacy core banking systems. These systems, developed years ago, or even decades back, are complex, inflexible, and designed for specific functions. Built on outdated languages, databases, and hardware, they lack the flexibility and scalability needed for modern development. Thus, integrating them with newer systems can be challenging.

This lack of agility hinders innovation. Rapid development and deployment of new features becomes difficult, potentially causing banks to fall behind evolving customer demands. A study reveals that 44% of financial professionals struggle with integrating new technologies due to legacy systems, highlighting the industry-wide challenge.

Security measures and strict regulatory requirements

Banking is also a heavily regulated sector, with strict compliance requirements that are non-negotiable. After all, customer data security is paramount, and cyber threats are a constant concern. This, however, significantly impacts the adoption of DevOps. Integrating strict compliance standards into the banking software development process can pose challenges.

For instance, regulations like PCI DSS (Payment Card Industry Data Security Standard) and GDPR (General Data Protection Regulation) add layers of complexity. DevOps must ensure all code changes, deployments, and infrastructure configurations adhere to these ever-evolving standards. Without careful implementation, this can lead to a slower development lifecycle.

Implementation costs

Some organizations might see DevOps as a way to reduce costs, but that’s not its main goal. The true power of DevOps lies in its ability to unlock revenue growth by enabling the organization to deliver greater value to customers.

However, implementing DevOps effectively does require dedicated resources and budget. This includes new tools, training for the team, and potentially even upgrades to the existing infrastructure. Engaging a DevOps team can be highly beneficial in this initial phase. Their expertise can help estimate the total budget needed for a complete transition and make sure everything goes well.

So, there’s potential to reduce costs in the long run, especially in terms of lower maintenance costs after full implementation. But it’s important to take all the potential costs mentioned above into account at the very beginning of the process.

Adoption and integration of new tools

A common pitfall for companies adopting DevOps is focusing too much on the tools themselves. Many businesses mistakenly believe DevOps is simply about having the right software. However, the real key lies in fostering a culture of collaboration and communication between teams. This approach can lead to tool overload, creating a complex and confusing environment for teams.

To truly benefit from DevOps, your teams need to embrace the challenge of selecting the right tools for development, testing, and deployment. These tools need to work seamlessly together as a unified system. Choosing the right DevOps tools, however, can be tricky because they need to be secure and fit well with existing systems. Plus, businesses need to train the team on these new tools so they can use them effectively and stay productive.

Skills gaps

DevOps requires a unique blend of development, operations, and automation expertise. Many traditional banking institutions may lack employees with the necessary skills to fully embrace this new approach. This can cause problems with selecting tools, automating configuration, and integrating DevOps practices with existing workflows.

To address this challenge, banks can invest in training programs to equip their existing staff with the necessary DevOps skills and open culture. Additionally, attracting talent with relevant experience from other industries that have embraced DevOps can be a valuable strategy.

Cultural shift and communication

One of the biggest challenges organizations face with DevOps is getting people on board. Transitioning to DevOps requires a significant shift in the IT department and company culture, which can be uncomfortable for some employees. This resistance can manifest in several ways, from reluctance to learn new tools and processes, and unwillingness to collaborate with other teams to a general aversion to acquiring new skills.

While change is crucial for growth, it can be unsettling for those used to doing things a certain way. The key to making DevOps work is taking it slow and steady. Only then DevOps principles can be smoothly ingrained into devops pipeline and the company culture.

Issues with the right standards and metrics

Another significant hurdle for DevOps adoption in banking is the challenge of establishing a unified set of metrics and parameters for success. Traditionally, Dev and Ops teams have operated with distinct goals, working systems, and even toolsets. This can make integrating their tools and finding common ground for measurement a tedious process. To overcome this, teams must agree upon a mutually beneficial set of metrics for data analytics.

Unlike past IT initiatives where success might be narrowly defined by cost reduction, DevOps success in banking requires a more holistic approach. The parameters for success should be established by seasoned experts who can quantify the true value delivered to customers. This value could encompass factors like faster time-to-market for new financial products, improved customer experience through digital channels, and increased operational efficiency. By focusing on these broader metrics, banks can ensure DevOps adoption truly benefits the organization as a whole.

How can banks effectively manage the transition to a DevOps model?

Transitioning to DevOps requires more than just new tools. It involves rethinking workflows, team structures, and internal culture. Financial institutions should start by identifying bottlenecks and involving key business stakeholders to ensure alignment with strategic goals. Building a cross-functional team with both development and operations leaders helps keep everyone working toward the same outcomes.

Banks should prioritize training and upskilling their teams, invest in secure and scalable infrastructure, and gradually reduce manual processes and implement automation where it makes the biggest impact. A strategic approach, supported by leadership and aligned with regulatory standards, ensures that the transition delivers measurable outcomes and supports long-term growth.

Achieve seamless DevOps transformation with Neontri

Dealing with DevOps in banking can be challenging, but at Neontri, we turn these challenges into opportunities for innovation. With over 10 years of experience, more than 100 successfully delivered banking projects, and a focus on advanced DevOps practices, we excel in providing cutting-edge banking solution services.

Our DevOps services are designed to deliver faster, more reliable, and high-quality software, specifically for the banking and financial services sector. We handle everything from automating infrastructure to smooth deployment and continuous monitoring. Our experienced teams provide complete solutions that fit perfectly with your business needs. We don’t just implement DevOps; we create a strong, scalable pipeline that integrates seamlessly with your existing systems, ensuring compliance and efficiency.

Final thoughts

Although DevOps brings many advantages to banks, its implementation in the financial sector requires careful attention to the challenges unique to this industry. From the legacy systems to skills gaps and the need for robust metrics, banks must navigate these hurdles to fully unlock the potential of DevOps.

FAQ

What metrics should be used to measure the success of DevOps in banking?

DevOps in financial services can be measured by deployment frequency, lead time for changes, and mean time to recovery (MTTR). These metrics demonstrate the speed and quality of delivering new features or fixes while keeping the system stable and secure, which is crucial in banking.

How does DevOps contribute to the innovation and development of new banking products?

DevOps drives innovation in banking by accelerating and enhancing the delivery of new features through process automation and continuous integration. This approach allows banks to develop and release products more efficiently, meet customer needs without compromising security or compliance.

What are the key emerging trends in DevOps for banking?

Banks are increasingly turning to AI-driven tools and automation to speed up development and improve how they predict and manage system issues. Security is being built in from the start through DevSecOps, helping teams catch vulnerabilities early and protect sensitive financial data. Many banks are also modernising legacy systems by shifting to cloud-native and open-source platforms, which offer greater flexibility and scalability. At the same time, they’re streamlining DevOps toolchains, automating compliance tasks, and encouraging collaboration across teams—all to drive innovation faster while staying aligned with regulatory requirements.

How can banks break down organizational silos?

First, banks should put together cross-functional teams that have the same KPIs and goals. Open communication and collaboration tools like Slack or Jira make it easier for departments to work together. Aligning incentives across teams keeps everyone focused on the same goals. Also, banks should connect their systems and make it easy for data to flow so that everyone in the company can easily access information. Strong leadership that supports agile ways of working is essential to making these changes stick and improving delivery across the business.