The use of open APIs has increased tremendously in the last five years, largely driven by the growth of new digital solutions across various industries. There is growing pressure for the financial services industry to catch up on this paradigm shift, as customer needs are evolving more rapidly and more fintech firms have been thinking beyond traditional banking and offering newer, more agile solutions to make banking more digitally accessible to consumers of all ages. This calls for an industry-wide need to collaborate on a whole new level. By leveraging on each other’s strengths, traditional banks and upcoming fintech firms are better able to easily react to changing market demand at speed and provide the best possible service to their customers.
In a recent workshop, B-Hive invited Google-backed Apigee to share its API platform management expertise with its partners. The goal of the workshop was to discuss the challenges of using open APIs and explore how they can enable the financial services industry to embrace an ‘open banking’ approach. Real-life cases on platform-driven businesses such as Walgreen’s and Philips Hue were presented during the workshop, highlighting how their successes are hinged on how easily they enabled third-party developers and partners to seamlessly connect apps, data and devices on their platforms.
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While the use of APIs is not new in financial services, the move towards open APIs will definitely enable large financial institutions to use the digital transformation towards its advantage. By embracing an open banking approach, they can easily innovate and create new solutions by potentially working with fintech disruptors to provide a better user experience for their clients. Instead of looking at fintechs as threats, moving towards an open banking approach makes room for these insurgents to be seen as potential partners in the delivery of hyper-personalized experiences to a large, established customer base. Banks and insurance companies are invited to rethink their traditional business models and product development and delivery across multiple channels, providing personalized solutions that support the customers’ ever-changing needs.
Think you can contribute to an open banking platform?