By Shikhar Gupta
Imagine a venerable bank with servers humming in the data centre like an old locomotive engine— trying to sprint into the future. That’s the reality for most Banking, Financial Services, and Insurance (BFSI) firms today. As per the studies, more than 80% of financial firms have embraced DevOps, and market forecasts predict a $25.5 billion DevOps-in-finance industry by 2028. Yet despite this momentum, BFSI teams face unique hurdles. Picture a century-old bank – its core systems are like a vintage car in a Formula 1 race. Finance leaders strive for speed and innovation, yet challenges such as compliance, legacy code, and risk aversion make each release akin to defusing a bomb.
In this definitive expert guide, we go deep into the top 10 DevOps challenges BFSI enterprises face and, more importantly, the strategic, proven ways to overcome them.
This isn’t another surface-level blog—this is the blueprint seasoned CTOs, IT leaders, and digital transformation heads need.
1. Legacy Systems That Were Never Built for Change
Most BFSI institutions run critical workloads on legacy infrastructure—core banking systems built decades ago, monolithic architectures, or even mainframes. These systems are stable but notoriously resistant to change, lacking APIs, modularity, or flexibility. The average top-tier bank runs around 8–12 core banking platforms, 25+-year-old mainframe systems, and over 1,000 interdependent applications.
Why It’s a Challenge: DevOps thrives in dynamic environments—containerised, loosely coupled, service-based systems. But in BFSI, core applications often run as massive black boxes. Integrating them into a DevOps pipeline is like trying to retrofit a steam engine with a jet engine’s afterburner.
Solution Strategy:
- Use the Strangler Pattern: Gradually replace parts of the monolith by building new services around it.
- Encapsulate with APIs: Wrap legacy logic in modern RESTful interfaces.
- Automate Interface Points: Even if you can’t containerise a mainframe, automate the orchestration and testing that surrounds it.
- Adopt Hybrid Architectures: modernise incrementally without halting mission-critical operations.
This approach allows BFSI firms to reduce risk, preserve stability, and introduce agility—one layer at a time.
2. DevOps Under Regulatory Pressure
Financial institutions operate in the most heavily regulated environment. Every code change, infrastructure modification, and deployment must withstand regulatory scrutiny. Compliance isn’t an optional feature in BFSI—it’s the bedrock. PCI-DSS, SOX, GDPR, RBI Circulars, and internal audit standards place rigid demands on how software is built, deployed, and operated.
Why It’s a Challenge: DevOps is about fast iterations and continuous releases. Regulatory compliance demands documentation, traceability, segregation of duties, and audit trails. These two realms frequently clash.
Solution Strategy:
- Embed policy-as-code: Automate checks and controls into the CI/CD (Continuous Integration/Continuous Deployment) pipeline using policy engines.
- Digitise Governance: Replace manual checklists with automated workflows that log and report changes in real time.
- Version Control for Compliance Artefacts: Store audit documents, test evidence, and sign-offs in Git or a DevOps repository.
This enables agile compliance—a world where every commit, test, and release can be traced, audited, and validated.
3. Making Security Seamless—Not a Silo
Security in BFSI is paramount. However, if a separate InfoSec team solely manages security at the end of the SDLC, vulnerabilities can slip through, leading to a bottleneck in patching.
Why It’s a Challenge: Traditional security slows down releases. Yet, BFSI firms can’t afford breaches—especially in production environments handling sensitive financial data. Financial institutions experience around 300% more cyberattacks than other industries and average breach costs of $5.85 million.
Solution Strategy:
- Shift Security Left: Instead of treating security as an afterthought, Shift Security Left emphasises integrating security considerations from the very beginning of the development process. This allows developers to identify security vulnerabilities early on, before the code is even executed. Incorporate static code analysis (SAST), dependency scanning, and threat modelling into the developer workflow.
- Development, Security, and Operations Toolchain (DevSecOps): This software development methodology incorporates security into every phase of the software development lifecycle instead of handling it as a stand-alone step. It places a strong emphasis on cooperation between the operations, security, and development teams to guarantee that software applications are constructed securely. Include technology in your CI/CD workflow, such as OWASP ZAP, Snyk, Checkmarx, and SonarQube. Security Champions: Train DevOps engineers to act as security advocates within scrum teams.
- Security Champions: Train DevOps engineers to act as security advocates within scrum teams.
By doing this, BFSI institutions bake security into every commit, making it a first-class citizen rather than a compliance checkbox.
4. Tool Sprawl and Disconnected Automation
Across units, different Dev, QA, Ops, and Infra teams often use different tools for the same tasks—leading to redundancy, integration nightmares, and chaotic release cycles.
Why It’s a Challenge: Without a unified toolchain, DevOps loses its value. Teams waste time maintaining disparate setups rather than shipping value to customers.
Solution Strategy:
- Centralise Tool Governance: Define a standard DevOps toolchain for version control, build automation, artefact management, testing, deployment, and monitoring.
- Platform Engineering: Create reusable templates, CI/CD-as-a-Service, and self-service deployment pipelines across teams.
- Use DevOps Dashboards: Track metrics and pipeline health across projects in a single view.
A unified toolchain means fewer handoffs, fewer surprises—and much faster, safer deployments.
5. Test Environment Chaos and Synthetic Data Deficiencies
You can’t test what you can’t replicate. But BFSI applications often depend on dozens of backend services—credit bureaus, payment gateways, fraud systems, and third-party APIs.
Why It’s a Challenge: Setting up test environments with all dependencies is expensive, slow, and inconsistent. Furthermore, using production data for testing can violate data privacy regulations.
Solution Strategy:
- Environment-as-a-Service (EaaS): It leverages containers and cloud-native stacks to provide on-demand, production-like test environments. This type of service allows developers to quickly provision environments for testing, staging, and other use cases, eliminating the need to manually create and configure them. Use containers or cloud-native stacks to provision on-demand, production-like test environments.
- Service virtualisation: It is a technology that allows testers and developers to simulate the behaviour of external systems and applications that an application relies on, even when those systems are unavailable, costly, or difficult to access.
- Synthetic Data Generation: Use tools to generate artificial test data that mimic real-world scenarios while anonymising sensitive fields.
This ensures your tests are not just quick but also realistic and regulation compliant.
6. Limited Automation in End-to-End Testing.
Testing in BFSI involves complex workflows—like loan approvals, claim settlements, and cross-border payments. Manual testing dominates due to perceived complexity.
Why It’s a Challenge: Without robust test automation, DevOps pipelines break at the final stage. Manual test cycles delay releases and increase risk.
Solution Strategy:
- Adopt BDD (Behaviour-Driven Development)/TDD (Test-Driven Development): Both approaches focus on writing tests before coding, but BDD emphasises user behaviour and collaboration, while TDD focuses on unit tests and implementation.
- Integrate API + UI + Performance Testing: Run functional, load, and stress tests in the same pipeline.
- Continuous Test Reporting: Automate report generation, dashboard visualisation, and results archiving.
This elevates testing from a task to a strategic advantage in accelerating delivery with confidence.
7. Siloed Teams and Resistance to Change
Culture takes precedence over strategy. In BFSI, departmental boundaries (Dev vs. Ops vs. Risk) often run deep. Change is considered risky, and failures are not tolerated.
Why It’s a Challenge: DevOps is not just about tools—it’s about people. Automation alone won’t make a significant impact without collaboration and shared ownership.
Solution Strategy:
- Cross-Functional Squads: Build teams with representatives from Dev, QA, Ops, and Risk.
- Blameless Postmortems: Normalise failure as a learning opportunity.
- DevOps Evangelism: Run internal roadshows, success showcases, and rewards for collaborative behaviour.
By transforming culture, you create an environment where DevOps becomes sustainable and scalable.
8. Lack of Real-Time Observability
You can’t mend something you don’t see. BFSI apps generate vast logs and metrics—but these are often stored in silos or reviewed only during outages.
Why It’s a Challenge: DevOps demands rapid feedback loops. Delayed alerts or noisy logs waste precious time during incidents.
Solution Strategy:
- Build Observability Layers: Combine application logs, infrastructure metrics, and distributed tracing.
- Centralised Monitoring: Use ELK stack, Prometheus-Grafana, or Datadog for real-time insights.
- Set Smart Alerts: Move from static thresholds to dynamic, behavior-based alerts.
This helps BFSI companies maintain high availability and customer trust by lowering mean time to detect (MTTD) and mean time to repair (MTTR).
9. Skills Gap Across Teams
DevOps requires a diverse skill set, from scripting, containerisation, infrastructure-as-code, and testing automation to cloud orchestration. BFSI teams, often built for traditional IT models, lack this breadth.
Why It’s a Challenge: Without trained engineers, even the best tools and strategies fall flat. Legacy expertise becomes a bottleneck in modern pipelines.
Solution Strategy:
- Create DevOps Academies: Launch structured learning paths for CI/CD, containers, cloud, and scripting.
- Mentorship Models: Pair experienced engineers with DevOps newcomers in real projects.
- Sandbox Environments: Encourage hands-on learning in risk-free settings.
BFSI companies provide the groundwork for long-term agility by developing a workforce that is prepared for DevOps.
10. Fear of Innovation and failure
The foundation of the BFSI sector is risk reduction. However, that very DNA frequently prevents experimentation, which slows down digital transformation and innovation.
Why It’s a Challenge: Agile requires iteration. DevOps thrives on rapid feedback. But if every failure leads to a blame game, innovation stalls.
Solution Strategy:
- Fail Fast, Recover Faster: Use canary deployments, blue-green strategies, and rollback mechanisms.
- Feature Flags: Test new features in production with limited exposure.
- Shadow Releases: Run new features silently in parallel to production without customer impact.
Encouraging safe failure fosters a culture where innovation and reliability can coexist.
Conclusion: DevOps in BFSI Is a Marathon, not a Sprint
Adopting DevOps in BFSI is not just about speeding up releases. It’s about building a resilient, secure, and innovation-ready enterprise. From reengineering legacy systems to redefining culture, from embedding compliance to creating self-healing systems—DevOps in BFSI is a transformation that demands clarity, courage, and commitment.
And those who get it right? They’re not just launching apps faster—they’re reshaping the future of financial services.
Ready to Build a BFSI DevOps Roadmap?
At ApMoSys, we specialise in crafting secure, scalable, and compliant DevOps solutions for financial institutions across India and beyond. Let’s co-create your future-ready pipeline.
