LSEG’s Cloud Service Transforms Financial Data Testing

Today, we’re thrilled to sit down with Kofi Ndaikate, a renowned expert in the ever-evolving field of financial technology. With a deep understanding of blockchain, cryptocurrency, and the intricate web of regulatory policies, Kofi has been at the forefront of helping financial firms navigate the challenges of modern tech infrastructure. In this conversation, we dive into the critical role of data testing in fintech, exploring how rising data volumes, stringent regulations, and innovative cloud-based solutions are reshaping the industry. We’ll also unpack the risks of neglecting robust testing practices and discuss how cutting-edge tools are empowering firms to stay ahead of the curve.

How has the landscape of data testing evolved for financial firms, and what’s driving its growing importance?

Over the past few years, data testing has shifted from a nice-to-have to an absolute necessity for financial firms. The primary drivers are the explosive growth in data volumes and the increasing complexity of technology systems. With market data volumes surging by 66% between 2021 and 2023, firms are grappling with unprecedented demands on their infrastructure. Add to that the expectation of message rates hitting 50 million per second across asset classes, and you’ve got a situation where systems must be tested rigorously to handle such intensity. Beyond that, regulatory pressures are tightening, forcing firms to prove their resilience against disruptions. Testing is no longer just about performance; it’s about survival in a hyper-connected, data-driven world.

What are the real-world consequences for financial institutions that fail to prioritize thorough data testing?

The stakes are incredibly high. Without proper testing, firms risk system failures that can cascade into major disruptions, costing millions in financial losses and eroding customer trust. Imagine a trading platform crashing during a volatile market event—clients lose money, and the firm’s reputation takes a massive hit. These incidents can also attract regulatory scrutiny, leading to fines or sanctions. I’ve seen cases where inadequate testing led to delayed transactions or erroneous data processing, which not only frustrated clients but also triggered compliance violations. It’s a domino effect that can be devastating if not addressed proactively.

How are new regulations, like the EU’s Digital Operational Resilience Act and the UK’s operational resilience rules, reshaping the approach to data testing?

These regulations, which came into effect in 2025, have fundamentally changed the game. They mandate that financial firms demonstrate their ability to withstand tech disruptions, placing data testing at the core of compliance strategies. The EU’s DORA, for instance, requires firms to map out their ICT risks and test for vulnerabilities regularly. Similarly, the UK’s rules push for operational resilience under stressed conditions. This means firms can’t just react to issues; they must anticipate them through comprehensive testing. The challenge lies in aligning internal processes with these strict standards, but it’s also an opportunity to build more robust systems that can weather any storm.

Can you walk us through the essential components of a strong data testing strategy for financial firms?

Absolutely. A solid testing strategy starts with a clear understanding of how your applications should perform under both normal and extreme conditions. Firms need to analyze historical market events—like periods of high volatility—to set benchmarks. From there, it’s about defining parameters for typical operations and stress scenarios, ensuring you’re prepared for the unexpected. Objectives, scope, and deliverables must be crystal clear in your testing plan. It’s also critical to simulate real-world conditions as closely as possible, using historical data and tools that mimic live environments. This approach helps uncover weaknesses before they become crises, saving time and resources in the long run.

What unique advantages do cloud-based testing solutions offer to financial firms looking to modernize their infrastructure?

Cloud-based solutions are a game-changer because they offer scalability, speed, and access to vast datasets without the burden of on-premises infrastructure. For instance, being able to deploy a testing service within 24 hours is a huge advantage for firms needing quick turnarounds on projects or proofs of concept. These platforms also provide historical data going back decades, which is invaluable for stress-testing against past market events. Tools that simulate real-time data flows and integrate seamlessly with existing applications allow firms to test in conditions that mirror reality. Ultimately, the cloud reduces costs and complexity while enhancing the accuracy and reliability of testing outcomes.

What is your forecast for the future of data testing in the financial sector over the next decade?

I believe data testing will become even more integral as data volumes continue to skyrocket and technologies like AI and blockchain further transform the industry. We’ll likely see message rates and data complexity grow beyond what we can imagine today, pushing firms to adopt more automated and predictive testing solutions. Regulations will keep evolving, demanding greater transparency and resilience, which means testing will need to be embedded in every stage of tech development. I also expect cloud-based platforms to dominate, offering more sophisticated simulation tools and real-time analytics. For financial firms, the future is about staying ahead of the curve—those who invest in robust testing now will be the ones leading the pack in the years to come.

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