What Makes MPLS an Ideal Network Technology for BFSI Organisations

MPLS offers stable, secure and scalable WAN connectivity on an outsourced routing model with high QoS and is backed by an SLA. For BFSI companies, it helps them in running different kinds of applications efficiently on a logically private and secure network. MPLS is also easy to manage and ensures a high uptime for these businesses in the financial and risk management industry.

Information – packed in emails, documents, spreadsheets, videos, VoIP solutions and other multimedia files – moves across the Internet all around the world. At the core of this transmission are specific protocols that define the packet structure of the data being transferred, or the control commands that manage the session, or both.

How the information moves from its source to the destination is all about reading and understanding this protocol. While different communication technologies operate through various protocols, MPLS’ strength lies in its involving multiple protocols and, therefore, offering a vibrant mix of benefits to business users.

Banking Financial Services And Insurance or BFSI organisations provide customers with financial services; that is why it is important for them to have a secure channel to share data privately. Since the organisations have their offices in remote locations, having a secure connection is important, and MPLS technology is the best way to do so.

What is MPLS?

Multi-Protocol Label Switching (MPLS) is a telecom routing technique that connects geographically spread out branches of an organisation on a high-performance network. With MPLS connectivity, data packets are transmitted on a path via labels and do not need complex lookups in a routing table at every stop.

MPLS virtual private network (VPN) helps businesses to create a next-generation intelligent network that can handle a range of advanced value-added services on a single architecture.

Besides establishing a highly available end-to-end connection and delivering consistent performance, MPLS also adds an optimal level of security in business networks. As a VPN solution, it gives users protected access to sensitive information. This is why it is usually recommended as a data forwarding technology for banks, financial services and insurance (BFSI) organisations.

MPLS technology is a routing mechanism that transfers the data packets based on a predetermined path label instead of the traditional way of using network addresses. It helps connect several branches of an organisation over a high-speed network.

MPLS technology Smart VPN WAN by Tata Tele Business offers a secure network to businesses that can handle several services on a single architecture. With VPN, users get protected access to sensitive data, thus recommended for BFSI organisations.

Let us look into some more factors that make MPLS VPN configuration a suitable option to fuel data transmission for businesses that are directly involved in investments, lending and risk management. Features that make MPLS technology the best solution for BFSI organizations.

Cost Benefits

MPLS is a Layer 2.5 technology that enables sharing of resources besides private routing for critical data. With its extra layers of security and networking efficiencies, it also offers some of the cost advantages brought by Layer 3 public Internet.

Basis the particular mix of applications and network configuration in an enterprise, MPLS connectivity can reduce costs by 10% to 25% when compared to other data services such as ATM and frame relay. As BFSI companies continue to deploy multimedia-rich apps to serve their customers in a digital-first environment, they can materialise network-wide cost savings of up to 40% by adopting MPLS technology.

Furthermore, MPLS-powered networks are easy to manage, which further brings down the OpEx for business users.

With MPLS technology, organisations can share resources that help reduce costs by up to 25% compared to other data services. MPLS makes use of the cost-efficient public internet with its extra security and efficient network for private routing of data. Also, the network is easy to manage, which brings down the cost even more.

Network Security

In establishing a VPN, MPLS makes the business network secure and private. It partitions the network from the public Internet and the threats associated with it. Within this shielded WAN, only authorised personnel can access the business data and their customer information for daily operations.

MPLS also creates a privatised cloud network and allows BFSI companies to send information requested by their customers through an encrypted transmission tunnel.

One of the key benefits of MPLS technology is that it privatises the public internet by using VPN. Only authorised employees of the BFSI organisation can access the data and customer information. It also helps create a private cloud that lets customers access the information using an encrypted network to offer safety from any threat.

Scalability

Another benefit of MPLS is that it supports businesses at the automatic configuration of their network and simplifies the setting up of tunnels or label-switched paths. MPLS is physically less resource-intensive when it comes to the configuration of additional circuits for the expansion of complex networks.

The protocol-agnostic nature of MPLS also allows it to carry different types of traffic – such as VoIP, video, text, images, documents and other files – efficiently without consideration of the ‘kind of traffic’ it is.

Ease of scalability makes MPLS a good option for organisations such as fintech companies that started small-scale but are expanding their operations consistently in the BFSI industry of India.

BFSI organisations often start small and then expand over time. With MPLS technology, expansion of networks is easy. There is less need for resources when adding circuits to an existing network, and the network permits the transfer of files without considering their type. You can send different types of data files like video, text, VoIP, documents, images and others over an MPLS network.

Better performance

Due to the any-to-any nature of MPLS service, there are fewer ‘hops’ between network points. This translates into higher response time and optimised application performance. MPLS also offers advanced traffic engineering options enabling traffic to be sent on the best alternative paths – it reduces latency and congestion on the linear traffic paths.

With improved network performance and low latency, BFSI companies can complete their transactions more efficiently. They can avoid delays in sending and receiving mission-critical data between their branches and to the customers.

Data packets sent over MPLS technology have a predetermined short path and better alternate routes for packets in case of higher traffic, and that helps improve the response time. It helps enhance the performance, and thus transactions can happen more efficiently in BFSI organisations.

Quality of Service

An important benefit of MPLS is its ability to assign QoS features to traffic. As it works with a system of labels, businesses can determine prioritisation levels associated with those labels. It implies that they can subscribe to different levels of bandwidths or port sizes and specify what type of traffic goes first and what can be held back for delivery if there is congestion on the network link. They can also decide upon latency, jitter and packet loss minimums for each traffic type.

BFSI companies today not only handle the operations and updates related to customer accounts but also explore huge quantities of data. Such inputs map the demographics, client preferences and country-wide financial trends to help them manage risk projection and improve customer relationship management. QoS enabled by MPLS helps multiple teams in sharing a common network more productively.

BFSI companies manage customer accounts and also handle large amounts of data. For having better customer relations, it is essential to determine what data is of higher priority and needs to be processed first.

With MPLS technology, it is easy to assign priority levels to data packets. It helps specify what data is of high priority and needs to be sent first and what can be held back in case there is high traffic on the network. It offers a more productive use of the common network.

Disaster Recovery MPLS technology connects data centres and business sites in multiple ways, which ensure easy connectivity to the cloud. BFSI organisations can not delay monetary processes even when there is a network issue. MPLS technology helps connect to a backup location quickly when needed for a continual operation or disaster recovery.

Improved uptime

MPLS also reduces the amount of manual intervention required from the network service provider in building wide-area connectivity. This feature reduces the chances of human error that can bring a circuit down. Furthermore, MPLS is a dedicated connection backed by a service level agreement (SLA) that promises seamless networking.

For banks and other financial organisations that must address their customers’ needs on their premises as also through digital applications, it is essential to have continual access to their database. MPLS connectivity becomes a suitable choice in such cases.

With MPLS technology, there is less need for manual intervention, which lowers the risk of human error. BFSI organisations need to have continuous access to their database for addressing their customer's needs either at the office or through the apps. MPLS ensures seamless networking as it is backed by a service level agreement.

Disaster recovery

MPLS VPN configuration is known to improve business continuity and disaster recovery. It allows data centres and other key sites to be connected in multiple redundant ways to the cloud and, therefore, to other business sites on the network. It is quick and easy to connect to backup locations whenever required. The feature makes MPLS a better option than ATM and frame networks wherein switched or backup permanent-virtual-circuits are needed.

Flexibility for business recovery is a key justifier for MPLS rollouts in BFSI organisations that are not expected to cite “network issues” as a reason to delay the processing of critical monetary processes.

The Smart VPN WAN Connectivity solution by Tata Tele Business Services originates from the MPLS technology and has been further optimised with Secure Connect for private cloud, wired and wireless last-mile connectivity and Internet VPN for ubiquitous reach. The combination makes it an ideal connectivity option for BFSI companies and other businesses that seek robust networking, privatised access to their data, high-performing enterprise apps, and multiple connectivity options to work collaboratively with their remote teams and that too at a best-suited cost-effective model.