Why modern financial services need north-south and east-west networks

The network challenge financial services can’t ignore

For years, financial institutions built their networks around a simple, practical question: How do customers and employees securely access our systems?

That single question shaped decades of infrastructure. Networks were designed to prioritize reliability, security and availability for customer and employee access, powering mobile banking, ATMs, branches and digital logins.

And for a long time, that was enough.

But today, financial services organizations are playing a very different game. One defined by hybrid and multicloud environments, real-time decisioning and AI-driven operations where what happens between systems matters just as much as how users get in.

That shift requires modern infrastructure built to support both north-south access and east-west connectivity across clouds, data centers and critical financial ecosystems. The clearest way to understand this shift is to look at how network traffic moves through financial systems.

What is north-south and east-west traffic?

Every financial institution depends on two fundamental types of network traffic, and today, both matter more than ever.

North-south traffic

North‑south traffic is the traditional flow of data in and out of systems. It powers:

• Mobile and online banking
• Branch and ATM connectivity
• Digital customer experiences
• Secure access to applications and data

This is the front door of financial services. If it’s slow, unreliable or unsecure, nothing else matters. Trust, uptime and security all live here. And for most institutions, this layer is mature, optimized and expected to work flawlessly. In fact, while access‑driven workloads are largely optimized, 83% of firms report that cloud migration for risk management is already complete, signaling that this phase of modernization is well under way.¹

East-west traffic

East‑west traffic, by contrast, moves behind the scenes and supports how financial institutions run end-to-end. It represents the connective layer that allows financial institutions to operate as modern, interconnected ecosystems, enabling data to flow:

• Between applications and platforms
• Across clouds and data centers
• Between internal systems and external dependencies: partners, analytics engines and AI systems

In financial services, operations don’t stop at the bank’s walls. Transactions, fraud checks, risk models, analytics and reporting all depend on constant coordination with payment networks, fraud providers, identity services, market data sources, fintech platforms, clearing houses and regulators. East-west traffic is what keeps these dependencies connected so the business can operate in real time.

Why is east-west traffic increasingly critical in financial services?

For years, east-west traffic supported operations quietly in the background. Today, it’s central to agility, intelligence and growth, enabling organizations to power real‑time decisioning, AI, analytics and connected financial operations at scale.

Growth is no longer just about giving people access to systems. In 2025, 82% of financial services firms operated in hybrid or multicloud environments, and 87% have increased cloud investment making system‑to‑system (east‑west) connectivity a core requirement, not an IT nice‑to‑have. ²

Behind every payment, trade or card swipe, dozens of systems activate in real time:

• Fraud, risk, AML and compliance platforms exchange signals.
• AI and analytics engines continuously evaluate patterns.
• Core systems coordinate with partners, exchanges and clearing houses.

In practice, this shows up in a few critical ways:

• Real‑time fraud prevention: Transaction data, identity services and AI models exchange signals across clouds in milliseconds to stop fraud before authorization completes.
• Continuous risk and liquidity management: Risk engines continuously pull data from trading platforms, market feeds and clearing systems to monitor exposure during volatility.
• AI‑driven decisioning: Models pull in fresh data and make decisions almost instantly, all without impacting the customer experience.
• Regulatory reporting and compliance: Systems remain synchronized across environments, reducing reconciliation gaps and accelerating audits.

All of this depends on fast, predictable east‑west traffic, moving across environments without friction. Just as importantly, consistent east‑west connectivity simplifies auditability, incident response and regulatory reporting by ensuring systems remain synchronized and observable across hybrid environments.

AI has raised the stakes even higher. Models don’t operate in batches or after the fact. They require continuous access to fresh data and must feed decisions directly into live transaction flows without slowing the customer down. That means more internal traffic, moving faster, across more places.

While 78% of banks are using generative AI tactically, only 8% are operating at scale.³ That gap isn’t driven by lack of ideas, it’s driven by infrastructure. When data can’t move quickly and reliably between systems, AI stays stuck in pilots instead of delivering real business value.

As financial institutions deepen on-prem, hybrid and multicloud strategies, east‑west traffic continues to explode. This is where meaningful transformation happens. New products can launch faster. Systems can become more resilient and responsive. And AI moves from experimentation to real‑world impact.

East‑west networking is no longer background plumbing. It’s the engine driving modern financial services forward.

Legacy networks weren’t built for both types of traffic

This is where many financial organizations hit a wall because their networks weren’t built for both directions at once.

Traditional networking architectures were designed to excel in one direction, not both. Legacy infrastructure handles north‑south traffic well because it’s built for access, perimeter security and predictable flows. Cloud environments, on the other hand, manage east‑west traffic effectively but usually only within a single cloud ecosystem.

Financial services don’t operate in just one place. They span multiple clouds, data centers, edge locations and partner networks simultaneously. And everything must work together securely and with low latency.

You don’t get to choose between access and coordination. You need both, without adding operational complexity. For financial institutions, this is a business risk as well as an architectural challenge. When network capacity can’t be deployed quickly or predictably, organizations struggle to respond to market volatility, scale during peak demand, onboard new partners or meet regulatory timelines. Delays in infrastructure delivery can slow innovation, increase operational risk and limit the ability to act when timing matters most.

What happens when east-west connectivity falls short?

When east-west connectivity can’t keep up, the impact shows up quickly.

• Fraud signals arrive too late to stop losses.
• AI models are forced into batch processing instead of real‑time decisions.
• Systems fall out of sync, complicating audits and regulatory reporting.
• During volatility, capacity can’t scale fast enough to protect performance.

What looks like an infrastructure gap quickly becomes a business risk, slowing decision making, increasing exposure and limiting how fast institutions can respond to market and regulatory pressure. In highly regulated, high‑volume environments, these failures compound quickly, turning milliseconds of delay into material business impact.

Infrastructure requirements for modern financial services

As financial institutions shift from access-led architectures to system‑to‑system orchestration, the network itself becomes a limiting factor.

Supporting both north-south and east-west traffic at scale requires infrastructure that delivers predictable latency, high capacity, secure synchronization and fast deployment across data centers, clouds and financial markets. Without that foundation, even the best applications and AI models struggle to perform in real time.

A network built for how financial services operate

This is where an integrated network approach becomes critical and where Lumen stands out. Instead of treating north-south and east-west as separate challenges, Lumen approaches them as part of the same integrated system, designed to support both access and coordination at scale.

In financial services, timely deployment is critical. Slow network builds can delay market entry, limit capacity during periods of volatility, and make it harder to respond quickly to regulatory demands or new opportunities. When infrastructure can’t be delivered at the speed of the business, growth slows and risk increases.

Lumen® Wavelength RapidRoutes℠ are designed to solve this problem. RapidRoutes are pre‑built, high‑capacity wavelength routes that connect major financial markets, data centers, and cloud regions across more than 35 metros, 350 data centers and 125 cloud on‑ramps, providing the reach and scale modern financial services require.

Because RapidRoutes are already engineered, validated and prioritized, financial institutions can quickly turn up 100G or 400G wavelength connections with a 20‑day SLA on qualifying site pairs, instead of waiting months for custom design and build cycles. This enables faster time to value and more predictable execution when timing matters most.

In simple terms, this means:

• Customers still get fast, secure, reliable access.
• Systems can communicate across clouds and data centers without friction.
• Data and workloads move where they’re needed quickly and predictably.

By combining high‑speed network routes with scalable wavelength capacity, Lumen makes it easier for financial institutions to support real‑time trading, risk analysis, AI and regulatory needs. It’s a network designed for how the financial services industry works today.

What modern network infrastructure unlocks for financial services

When financial institutions can support both north-south and east-west traffic flows, the business impact reaches far beyond connectivity.

• Resilience built in, not bolted on: Systems stay in sync across environments, helping failovers happen with fewer disruptions.
• Smart fraud and risk management: Fraud, risk and compliance systems can share signals in real time instead of operating in silos.
• Fast innovation cycles: Businesses can launch new products and services without reworking infrastructure.
• Enhanced productivity: Employees can spend less time switching between disconnected systems and more time focusing on customers and outcomes.

This is what becomes possible when the network is built for both access and real-time coordination.

Modern financial services need high‑capacity networks that move data fast between clouds, data centers and markets. See how Lumen RapidRoutes deliver ready‑to‑deploy 100G and 400G connectivity built for east‑west traffic and real‑time financial workloads.

_{¹Fintech News Switzerland, Financial firms priorities cloud for AI and operational resilience (LSEG Survey), July 2025.}

_{²London Stock Exchange Group (LSEG), Global cloud survey: Financial services firms embrace cloud to drive competitiveness, July 2025.}

_{³IBM, IBM study: Gen AI will elevate financial performance of banks in 2025, PR Newswire, February 2025.}

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