Rapid Data Growth and the Challenges It Presents 

In the financial services industry, the volume of data generated and accumulated is expanding at an unprecedented rate. This explosion of data is driven by several key factors. The rise of digital banking and insurance, mobile payments, and a highly volatile market environment has led to a surge in the number of daily transactions. Each of these transactions generates detailed records that must be stored and managed.

Additionally, new regulatory requirements, such as IFRS 17 and the US GAAP LDTI changes, necessitate the maintenance of extensive records, including transaction records, audit trails, and compliance documents. The obligation to store these records for extended periods further contributes to data growth.

SAP solutions for financial services such as FPSL (Financial Products Subledger), FS-CD (Collections and Disbursements), and PaPM (Probability and Performance Management) handle substantial amounts of transactions and gives customers new insights into their data. However, the rapid growth of data presents several challenges for financial institutions. One of the primary challenges is storage capacity. The vast and continuously growing volume of data requires substantial storage infrastructure. Scaling storage capacity to keep pace with data growth is expensive and complex, often necessitating significant investments in hardware and software.

Performance issues are another challenge. As active data stores expand, the performance of critical financial systems can degrade. This slowdown affects transaction processing times, real-time data analysis, and overall system responsiveness, which can negatively impact customer satisfaction and operational efficiency. Managing large datasets also increases complexity exponentially with growth. Ensuring data is properly categorized, indexed, and accessible while maintaining data integrity and security becomes a daunting task.

Moreover, with data protection regulations such as GDPR in the EU, financial institutions must ensure personal data is managed in compliance with the principles of data minimization, purpose limitation, and storage limitation. They need to implement technical and organizational measures to protect personal data against unauthorized access, accidental loss, or destruction.

What Can We Do to Face These Challenges?

To address these challenges, data archiving is a strategic necessity for financial institutions. Implementing robust data archiving solutions allows institutions to optimize storage costs by moving inactive data to lower-cost, high-capacity storage systems, reducing the burden on primary storage and leading to significant cost savings. This also enhances system performance by offloading inactive data from active storage systems, ensuring faster transaction processing and better customer experiences.

Furthermore, archiving data simplifies data management processes, making it easier to organize, retrieve, and maintain datasets. This is particularly important for compliance audits and regulatory reviews. Data archiving helps institutions meet regulatory requirements by securely storing data for the required durations, maintaining its integrity, and ensuring it is readily accessible for audits and legal inquiries.

How can SAP and msg global help you?

SAP provides comprehensive data archiving solutions and Information Lifecycle Management (ILM) tools well-suited to financial institutions' needs. SAP Data Archiving enables organizations to manage data growth effectively by securely archiving data from SAP applications. This process reduces database size, which improves system performance and reduces storage costs. By archiving data that is no longer needed for daily operations but must be retained for regulatory compliance, financial institutions can optimize their storage infrastructure.

SAP ILM takes data management a step further by providing automated data retention, archiving, and deletion processes, ensuring data lifecycle policies are consistently applied. This automation minimizes the manual effort required and reduces the risk of human error, making the archiving process more efficient and reliable. SAP ILM integrates with regulatory frameworks, helping institutions to meet compliance requirements by securely storing data for the required durations and ensuring it remains accessible for audits and legal inquiries. SAP ILM also safely handles the data retirement process at the end of the data management lifecycle.

At msg, we are experts in SAP Financial Services solutions. We offer data archiving and ILM to future-proof your SAP environment. Whether you are just beginning with SAP or have an established system, we can assess your data landscape, growth rates, and legal retention needs to identify and implement your data archiving and ILM requirements. Our services include:

• Outlining a data archiving strategy during the project blueprint phase
• Providing a standard catalog of key decisions regarding data archiving (retention periods, legal requirements)
• Configuration and setup of all data archiving-related functions
• Just-in-time setup of data archiving and ILM solutions for systems already in production facing critical storage issues.
• Troubleshooting data archiving functionalities
• Performance optimization of data archiving processes

Monitoring archiving processes and DB storage optimization.