“In a similar way to how Facebook allows third-parties such as YouTube to embed within its own platform via an API, banks will allow their services and data to be built on by third-party applications too. In this way, third parties will be able to access a bank’s data or services in a secure manner, within defined parameters,” writes Pedro Alexandre Salgueiro - Business Development Director, CRITICAL Software in Bob's Guide. Application Programming Interfaces are small pieces of software that connect different software systems together. They are fundamentally changing how systems work together as Salgueiro explains above.
Salgueiro believes that the biggest example of how APIs will have an impact is, “the ‘Directive on Payment Services’ (PSD2). This brings with it new rules that, among other things, increase consumer protection and encourage the use of better mobile and online banking processes. PSD2 has been hailed as the first step towards more open, customer-friendly banking, thanks to its support of APIs.”
Citi joins API party
Citi’s Treasury and Trade Solutions (TTS) has launched an Application Programming Interface (API) solution for payment initiation, payment status, and account balance inquiries through CitiConnect®, Citi’s connectivity platform. The CitiConnect® API allows Citi’s treasury services clients to directly connect with Citi to access services using their own Treasury Workstations or Enterprise Resource Platform (ERP) providing convenience, potential cost savings, and reduced risk. Citi supports API based integration across 96 countries, representing one of the largest API-supported geographies.
Citi write, “Evolving client needs now require fully automated solutions to process transactions directly from the client’s own treasury platform to their banking partners’, without having to rely solely on banking portals that often require proprietary builds, applications or interfaces. With the CitiConnect API, there is no need for additional providers or services, as API functionality empowers end-users to manage their transaction banking activity directly from their own trusted applications. Citi has worked with a core group of clients to pilot the API service, which they have integrated into their treasury processes to deliver payments real time to Citi, and collect information on the status of their payments.”
CitiConnect® API provides an ‘on-demand’ service that connects to Citi directly from a client’s Treasury Management or ERP system. Citi believe that, “The result is a seamless experience that has the potential to offer cost efficiencies and reduced operational risk. APIs make it simpler for Citi’s institutional clients to develop interfaces to Citi to access and manage their accounts allowing for Citi to offer a variety of transaction services in a dramatically different way. Following this initial launch, Citi expects to continue to develop additional API services for transaction banking including service inquiries, account management, and liquidity services.”
Seamless experience revolution
The potential for APIs to provide seamless experiences as systems and services link together is incredible. The best example today, Neil Ambikar, CEO & Founder, B2BPay believes is, “Skyscanner, with one click it is able to communicate with a 1000 airlines and within a few seconds each airline is able to provide you information on your flight preference and cost.” He continues, “This is the power of APIs to connect different systems seamlessly. Now think about how do all the financial systems communicate with each other?”
He believes this shows the extreme vulnerability of the financial services business. With his knowledge and understanding of the potential of APIs he sees the world very differently, with corporates and their systems on the one side and banks on the other, just separated by a virtual layer:
Source & Copyright©2017 - B2BPay
This could be the future of financial services. Indeed Ambikar sees two types of big wins in the financial and corporate treasury services space:
- “seemless integration of between various systems like audit tools, BI; ERP systems, banks, FX brokers, etc.”
- “using new products is a painful process: its expensive and it requires long implementation process and resources. APIs means you have more plug and Play ability. so treasury can try out a new system by simply downloading and connecting it to their systems via API, and then if they like it buy it just like you do with the Apple App store.”
CTMfile take: It is not clear how this revolution is going to pan-out in detail, but two things are clear: 1) there will be much more seamless experiences right across the cash and treasury management business, and 2) the banks will have to adopt and implement APIs big time, e.g. Citi are planning to roll-out their APIs across their whole transaction banking offering.
ANZ executes seamless BPO using STP & electronic Bill of Lading
50 corporate relationships and 20 banking groups live on BPO, as adoption of BPO grows steadily
Bank connectivity - which is most cost-effective: Host-2-Host or SWIFT?
Neither is automatically the cheapest, it all depends ………. Remember: SWIFT figures show that only 45% of Fortune 500 corporates are connected direct to SWIFT
Data connectivity made easy by Volante Technologies’ new VolPay Channel
VolPay Channel suite of payment software and electronic banking connectivity solutions can fully integrate all your ERP platforms into a single coherent whole