Data residency has always been part of the payments conversation. GDPR, PCI DSS, the Schrems II ruling that invalidated the EU-US Privacy Shield in 2020. The EU has long set the bar for how financial data should be handled and where it should live. Increasingly, the focus is shifting towards access rather than residency. Storing data in an EU data center is one thing. Having certainty over who can access it, when and under which jurisdiction, is something else entirely.

In October 2025, the AFM and DNB published a joint report with a pretty direct message: the Dutch financial sector has built up serious systemic risk by depending on a handful of non-European IT providers. A geopolitical disruption, or even a single provider outage, can cascade across entire chains of financial institutions at once. And this goes well beyond the Netherlands. DORA, which came into force across the EU in January 2025, requires financial institutions to actively map and manage concentration risk in their ICT supply chains. Regulators across Europe are aligned on this: know what you depend on, and have a credible plan.

The European cloud landscape is developing fast, and with serious players like STACKIT and Tencent investing heavily in EU infrastructure, competition is heating up. Closing the gap with years of accumulated infrastructure investment takes time. Rebuilding on something less mature can mean giving up the reliability, developer tooling, and pace of innovation that modern companies like Silverflow depend on. Most companies can't afford to slow down while these alternatives catch up.

The big players are also listening to the same regulatory signals and they are taking action. For example, AWS launched their European Sovereign Cloud in Brandenburg, Germany in January 2026. This environment is physically and logically separate from the global AWS network and registered as an independent legal entity under German law. Staffed exclusively by EU residents, it offers the same services, APIs, and infrastructure-as-code approach we already use, but with full EU governance over data and access.

Silverflow has run on AWS from day one, and we think that was the right call. The engineering leverage it gives us is immense, and being deeply invested in AWS is exactly what puts us in a good position right now. Because we built on AWS the right way, with infrastructure as code, clean account structures, and no architectural shortcuts, migrating to the Sovereign Cloud is a tractable engineering project. Our infra-as-code templates largely redeploy unchanged. The main work is refactoring our networking layer and re-establishing network connections to Mastercard and Visa. For our customers, nothing changes, they still access the robust and easy-to-use payment processor they trust with the same API contracts.

Legacy payment processors built their infrastructure long before the cloud was even a concept. For them, getting there means a rearchitecting effort measured in years, if it's feasible at all. We can move because we were built to move. That's the practical meaning of being cloud-native, and it's a real advantage when the regulatory landscape shifts under your feet.

Sovereign cloud frameworks deliver essential infrastructure anchored in European territory and governed by EU statutes. As technology matures and regulatory mandates sharpen, acquirers capable of rapid adaptation will secure a formidable competitive edge with both oversight bodies and clients. By proactively addressing these requirements, Silverflow remains positioned as a strategic partner, ensuring our customers navigate this evolving compliance landscape with confidence.

Want to know more about what this means for your Silverflow integration? Reach out to your account team.

By Kardelen Hatun, VP Engineering at Silverflow