SHENZHEN, China, July 27, 2018 /PRNewswire/ -- Through joint innovation with Huawei, China Merchants Bank (CMB) aims to build cutting-edge distributed database products that give a competitive edge for banking services, drive CMB's digital transformation, and help CMB become a financial technology (FinTech) bank.
CMB(China's first share-holding commercial bank whose shareholders include legal enterprise entities) was the first Chinese bank to hold umbrellas for customers coming in and out of the bank on rainy days, own the auto call distributors, and provide milk to customers. These kinds of thoughtful touches have helped CMB develop rapidly over the past 30 years. In 2018, the bank ranked 20 th in the Banker's Top 1000 Banking Brands, and 213rd in the Fortune Global 500.
Three Thoughts on CMB's Digital Process
Over the past 17 years since joining CMB in 2001, Mr. Tian Yongjiang, Manager of Application and Database Management Office, Headquarters Data Center, CMB, has witnessed the bank's ongoing digital transformation initiatives. Recently, technologies such as cloud computing and Big Data have developed quickly. Keeping pace with the times, CMB introduced these innovations to achieve rapid service development and better serve customers. Several of the changes have impressed Mr. Tian deeply.
First is the rapid development of infrastructure. From the bank's Shekou equipment room to the data center in Nanshan and the Nanjing disaster recovery data center, or the data centers in Shanghai and Pinghu, the upgraded facilities and expanded capacity are meeting CMB's increased service requirements.
Second is the impact of the Internet. CMB's top executives believe technologies can bring disruptive changes to banks — more so than strict supervision, small loan companies, or Internet financial companies. Therefore, CMB is attaching great importance to new technologies. For example, 30 % to 40% of the employees in the CMB business department spend 30%to 40% of their time on technology-related work and training. Besides, special funds have been established for innovative projects to support better service.
These efforts have paid off. CMB has built a unified risk control platform for credit cards based on Huawei's FusionInsight Big Data solution. The FusionInsight platform reduced the number of problem cases by 50%and saved more than CNY 100 million in six months. This platform also shortened the time to issue a credit card from 15 days to five minutes. CMB now supports the ability to issue loans up to CNY 300,000 within minutes.
The third change impressed me the most: CMB's commitment to a customer-centric concept. With the slogan 'We are here just for you,' CMB bears in mind that providing good services for customers is its foundation. It uses FinTech to facilitate its business operations and better serve our customers. It uses every technology to satisfy customer needs, improve customer experience, and create larger value.
Values Internet Financial Enterprises Cannot Match
CMB has strict architecture standards, such as read/write separation, database partitioning, active-active backup, and stateless multi-active operation. It has established a disciplined capability for implementation, and the gradual use of standard architectures has changed its standard for managing databases. With the standard architectures today, faults have little or no effect on services. This use of standard architectures is an evolutionary way of thinking, and a great improvement in reliability.
CMB's efforts in these areas differ from those of Internet financial enterprises to some degree. It implemented high-availability, high-scalability, and high-flexibility systems under strict supervision and predicated on customer security and experience. Mr. Tian thinks that CMB bears favorable comparison to Internet companies in terms of database architecture standards and implementation capabilities.
In recent years, technology development has generated more software. More types of applications are emerging, such as facial recognition, voice recognition, anti-fraud applications, and customer profile managers. These applications will evolve into public infrastructure services and will be centralized.
Constructing the Optimal Distributed Relational Database in the Financial Industry
Service innovations depend on IT and data. Therefore, it is critical to find a way to ensure information security and optimize the database.
Database partitioning and horizontal expansion reduce the dependency on a single database. This approach seeks to balance the tradeoffs among resources, costs, availability, and development difficulty. The solution is to have a distributed database, which represents a trend in database development. A distributed database offers several advantages. First, it reduces cost, including hardware, labor, and O&M costs. Second, IT personnel have a smaller workload. Most importantly, this type of database achieves better utilization of hardware resources and provides a higher unit output rate, to support more services.
Why is the trend to use distributed relational databases so widely recognized? First, the relational database will never be outdated.. Second, single databases are encountering bottlenecks. The number of users and concurrent transactions have reached unprecedented levels and will continue to grow. In the future, once breakthroughs are made in technologies such as quantum computing, the transaction volume will increase explosively.
Based on experience and a commitment to go further, CMB has decided to engage in a joint innovation program with Huawei in the distributed database field. They aim to build the optimal distributed database for the financial sector that will give CMB's services a competitive edge. Both will rise to the challenges of 'Cloud First' by leveraging technologies such as cloud computing, Big Data, and AI, as well as leading financial business practices and high-quality resources to connect services and technologies. Further, they will jointly develop the distributed database and put the products into use, to migrate database applications to the cloud.
By cooperating with Huawei, CMB hopes to build a competitive distributed database for finance with high performance, security, reliability, and scalability. They will use technologies such as latch-free data structures; NUMA-aware architectures; 3D-XPoint memory; high-performance distributed transaction processing, computing, and storage separation; Remote Direct Memory Access (RDMA); Group Buffer Pools (GBPs); and Z-Paxos protocol. These technologies will be used to build cloud-oriented scale-up/scale-out capabilities.
Over the years the financial industry has gradually refined the core value of the database, which is all about consistency. Databases play a critical role in data processing and solving all difficulties regarding consistency.
Based on these concepts, CMB has a clear specification for all online transaction systems, which simplifies the database function requirement, and shortens the development cycle.
Mutual Trust Builds the Foundation of Cooperation
The customer-centric concept is the first reason why CMB chose Huawei. CMB is born to serve customers, and gives the highest priority to customer satisfaction. That's also true for Huawei. With a shared spirit of excellence, Huawei and CMB respect, trust, and appreciate each other. Second, they believe in the strength that Huawei has accumulated with over 10 years of experience in the database field — including both in-memory and disk-based databases. The company has many successes in multiple business domains.
CMB also appreciate Huawei's service-minded approach and ability to tackle difficulties. About six years ago, Huawei left Mr. Tian with a deeply positive impression when CMB chose Hadoop products. At that time, several vendors, including Huawei, offered to provide Hadoop cluster products and services. After hearing CMB's six challenges, two of the vendors said the project was too difficult and dropped out. Only Huawei was willing to take on the challenge. Five months later, Huawei reported to CMB that five of the issues had been completely resolved and only half of the sixth issue remained. This interaction demonstrated to him that Huawei is determined to deliver on projects and deal with difficulties with service awareness and cooperation. This is the foundation of mutual trust.
CMB is a typical bank. Its interaction with Huawei is to propose advanced requirements and challenging functional attributes. Huawei sees that CMB has this capability and that the database developed by the two companies applies to banks as well as to businesses in other vertical markets supported by Huawei. Mr.Tian thinks that is why both parties choose each other to achieve win-win cooperation.
Huawei is planning to develop a database on the public cloud, and CMB can assist Huawei in developing such a database. By participating in this project, CMB will study to better understand the trend for database technology, as well as the planning and design for core databases. This project will be highly beneficial to CMB, especially in terms of talent cultivation.
The joint innovation between CMB and Huawei has three phases:
- Initial phase: Focus on commercial pilot projects in 2018.
- Growth phase: Reach industrial scale in 2019.
- Stable development phase: Carry out large-scale promotion and replication activities in 2020.
CMB is responsible for the design of requirements and solutions, and Huawei's Online Transaction Processing (OLTP) database team is responsible for technology implementation. Independent innovation will be conducted based on Huawei's experience, and infrastructures will be integrated based on new hardware capabilities. In this way, the project will achieve the overall objective of a high availability cloud-based deployment with high security, high performance, low cost, and differentiated competitiveness.
A three-layer product architecture will be adopted. The top level is the distributed extension layer. In the middle level, the enterprise core layer will support the high performance and general database capabilities for enterprise-level services. At the bottom level is the distributed storage and cloud storage layer. This architecture supports the vertical integration of software and hardware to deliver high-performance, high-availability, and cloud-native database capabilities.
Mr.Tian firmly believes that the distributed financial database jointly developed by Huawei and CMB will contribute to CMB's digital transformation and help CMB become a successful FinTech bank.