Application Programming Interfaces (APIs) are the answer to the question: how are start-ups able to build products so much faster these days? Typically, the financial sector is sceptical about new technology. But various market changes – from growing customer expectations and digital disruption to the rise of new competitors – are putting more and more pressure on banks to innovate their services.
This means that banks have a choice – they can either perpetuate existing models with one-off APIs that meet specific customer or regulatory requirements. Or they embrace open banking and build a new “banking platform” that supports future compliance and scalability needs, with the required level of flexibility to innovate.
APIs in action
Here are a few ways modern businesses can utilise APIs in digital payments.
#1 Change your approach to APIs: APIs are the cornerstones of any digital organisation and they are essential to digital transformation success. Think about APIs as collaborative products that increase revenue. APIs present a new way of working and creating value from the outside in.
#2 Identify use cases: This drives quick wins. It’s about asking the right questions – What areas might the business be missing out on? Where are new players doing well? Are there any key opportunistic plays you can leverage? Is open banking the answer?
#3 Embrace non-traditional workers: Increasingly we are seeing businesses collaborating with non-traditional workers. What does this mean? We’re talking about people who are not formally employed and work either on a freelance basis or form part of the emerging sharing economy, working for companies like Uber.
#4 Consider customer facing apps: Modern customers want things here and now, they don’t have the time or the patience to deal with tedious processes. Spend time figuring out what customers need and then create APIs that enable functionality. This paves the way for apps that can be updated as and when needs change.
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