Every cloud has a silver lining: How technology is revolutionising e-commerce payments

Simon Cavell & Ilke Barutcu-Cesaret

Simon Cavell & Ilke Barutcu-Cesaret

01 March 2024

It’s now 30 years since a team of cyberspace entrepreneurs sold a CD by Sting in August 1994 – the first ever online purchase!  The launch of Amazon as a book retailer (1995), Alibaba as an online marketplace (1999) and Google’s pay-per-click advertising capability (2000) would quickly follow. 

And so began a journey that would evolve into today’s e-commerce industry.  Online transactions now exceed £5 trillion annually for over 25 million businesses worldwide.

For both customers and businesses, this revolution has been enabled and accelerated by cloud technology, delivering smooth, secure operations with countless unique journeys.  Just like the silver lining of a cloud brings sunshine after a storm, this digital transformation has brought a brighter future for e-commerce payments.

Cloud technology and its impact on financial services

Put simply, cloud technology is the use of remote servers to deliver computing services. It enables users to store, manage, process, and access data, applications, and services without relying on – or investing in – their own local infrastructure.

  • Flexibility: Centrally managed and maintained, infrastructure can be changed more readily.
  • Scalability: Resources can be scaled to needs – e.g. increasing capacity during peak hours.
  • Cost-effectiveness: No upfront investment in hardware and software.  Particularly valuable where applications and services are only needed periodically.
  • Security: Data centres are protected by physical and network security.
  • Data security and privacy: A major challenge.  Entrusting data to a third-party provider can be a concern, especially where it is sensitive.
  • Third Parties: Assurance and oversight are required, especially given the data entrusted.
  • Pricing: Can be complex and variable, reflecting usage, performance, availability, location, and features.
  • Multi-cloud environments: It can be difficult to manage multiple providers, despite the cost and performance benefits offered.
  • Global networks: Clarity on where data is held and processed is critical for compliance and resilience.  

As a concept, cloud technology is not new.  Saleforce (1999) and Amazon (2002) were early pioneers in delivering software and retail services through the Internet. By 2023, worldwide end-user spending on cloud services was forecast to exceed £477bn, representing a remarkable increase of 20% on the previous year alone. 

Within the financial services industry, individual firms now spend an average of £16m annually on cloud technology, for services including:

Banks and building societiesUnderpinning new digital banking services, allowing customers to manage their accounts and transact worldwide.
Investment firmsDeveloping new algorithms that require scalability and performance to process large amounts of data and execute trades quickly and efficiently.
Insurance firmsImproving fraud detection capabilities by analysing large amounts of data from multiple sources to identify suspicious activity.
Payments providersProcessing transactions quicker and more securely, handling high volumes of transactions and protecting customers from fraud.


Cloud technology brings agile adaptation, instant scalability for dynamic market changes, extensive data handling for swift insights, cost-effective innovation through flexible services, and secure collaboration with partners that accelerates innovation and enhances user experiences.


The Cloud has transformed e-commerce and payments infrastructure

Cloud technology has significantly impacted global payments infrastructure, opening up new possibilities whilst also integrating and adapting legacy systems.

In 2023, more than 80% of e-commerce sites around the world used cloud technology – unlocking a new era of streamlined payments by making transactions faster, more secure, and highly accessible.

As more e-commerce operations move to the Cloud, this technology is becoming essential for businesses that want to keep pace with the competition. For example:

  • Amazon – One of the largest global e-commerce retailers, Amazon’s cloud-based payment system handles billions of dollars of transactions each year.  By migrating its checkout to the Cloud, Amazon reduced annual fraud losses by $100 million whilst also taking milliseconds off payment processing.
  • eBay – Leveraging the Cloud to streamline cross-border payments, eBay tripled international transaction volumes in just two quarters.
  • Walmart – A cloud-powered micropayments system unlocked in-store impulse purchases, increasing average shopping basket value by 15%.
  • PayPal – Harnessing the Cloud to handle Black Friday traffic spikes allowed PayPal to scale transactions by 10 times.
  • Stripe – Stripe's cloud-native API empowered thousands of startups to launch global operations within days.
  • eStore – A cloud-integrated mobile wallet tripled checkout conversions for many traditional retailers. This transformation not only enhanced transaction security but also provided customers with multiple payment options, including digital currencies.

So, what’s next?  Looking into the future of e-commerce Payments

With continued technology advances and increasing customer expectations, the opportunities offered by the Cloud will continue to drive innovation. Cloud-based payment solutions will be increasingly critical in enabling businesses to meet the needs of their customers and provide distinctive experiences.  We can expect the following trends:

  • Hyper-Personalisation: AI and machine learning will analyse data and present a personalised payment experience, tailored to individual customer needs and preferences. For example, loyalty programs automatically unlock personalised discounts or preferred payment options offered at checkout based on purchase history.
  • Tokenisation and Decentralisation: Blockchain technology and tokenisation have the potential to revolutionise online payments by removing the need for payment providers while increasing transparency and security. Decentralised finance might help provide alternative payment methods and democratise access to financial services.
  • Augmented Reality and Virtual Reality: As consumers transact more in virtual environments, payments must adapt to these immersive surroundings, integrating smoothly with the new platforms and promoting secure transactions.
  • Embedded payments: Cloud-based integrated finance seamlessly embeds purchases within consumers’ favourite activities, eliminating extra steps and sustaining engagement.  For example, buying a concert ticket through a music app or renting a scooter straight from an online map.
  • New payment methods: Cloud technology enables convenient and secure future payment options – a simple scan of your fingerprint or the wave of your smartwatch.

What challenges lie ahead?

Whilst the benefits of the Cloud are evident, deploying a new technology layer presents many challenges for firms, not least where there is a migration or integration with legacy infrastructure.  Pitfalls must be avoided in the following areas:

  • Cost Optimisation – ensuring investment spending is appropriate and impactful, supported by a strong business case, and tracked through to realise benefits.
  • Alignment to Strategy – new infrastructure must be fully supportive of a firm’s established strategy.
  • Customer Adoption – consideration of how to promote new services and functionality, building confidence with customers.
  • Governance & Oversight – appropriate assurance over the controls and resilience of third-party providers, especially where they enable critical aspects of the customer journey.

How can JC help?

Johnston Carmichael can help you plan for – and realise – the future potential of cloud technology within your business.  As experts in complex change, we can help businesses develop, execute, and realise the benefits of a future-focused strategy that achieves your organisation’s objectives.

For example:

  • Complex Change – we can help businesses with cloud migration journey, planning, programme delivery, and change management. We support operational excellence by helping you adopt new operating models and navigate regulatory compliance. Our expertise lies in project management and change delivery, ensuring smooth transitions within your business.
  • Performance Optimisation – we can help businesses identify and address areas to improve performance, whether removing bottlenecks or enhancing existing strengths. 
  • Our data-driven approach unlocks scalable solutions that optimise cost, output, and overall performance, engaging leaders and employees to achieve sustainable results.

To discuss how Johnston Carmichael could support your business objectives, or to understand more about the potential for cloud technology within your organisation, please get in touch with us.

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