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  • user 3:35 am on July 22, 2018 Permalink | Reply
    Tags: , APIs, , , , , ,   

    APIs: An enabler for transformation in financial services 

    Guest blogger Conrad Sheehan shines a light on the emergence of as innovation drivers.

    The adoption of powerful, open application programming interfaces (APIs) provides an opportunity to shape product innovation and partnerships across , particularly in the payments industry.

    APIs are the connectors, making it possible for producers, consumers, products and services to connect and create value. , payment service providers, fintechs, and other financial services-related companies are using them to expose business data, functionality and services to the outside world—stretching beyond their customary internal borders to create broader, unique business partnerships. It is how financial institutions are beginning to establish themselves as an integral part of a full, rich ecosystem. Indeed, APIs represent new opportunities to enable and accelerate of financial services in highly efficient ways to deliver enhanced customer experiences.

    Figure 1: How APIs work
    Source: Accenture

    Both regulation and market demand around the globe are influencing and shaping perspectives of Open Banking API product innovation in local markets. The European Union’s revised Payment Services Directive (PSD2), for example, is one of the most notable acts of regulation that aims at nurturing innovation, competition and data sharing in ways that better serve customers. PSD2 sparked similar legislative action in Australia and Hong Kong to create an open environment for their financial services markets. In the US, NACHA’s API Standardization Industry Group is an example of a market-driven initiative focused on defining API standards in payments. The ability of APIs to enable payments players to deliver more valuable, customer-focused payments experiences and find engaging ways to offer true value beyond the transaction itself continues to fuel demand across the digital ecosystem.

    I was delighted to participate recently in a panel discussion at SWIFT’s Latin America Regional Conference 2018. When polled about API enablement, 70 percent of the audience indicated that their organizations are using APIs. The audience also shared about the areas that APIs are helping facilitate: internal (25 percent), third-party integration (18 percent), and business flows (8 percent); nearly half (49 percent) answered “all”. The results further highlight that APIs have evolved from back office to front office and are enablers of third-party partnerships. Panel participants articulated that it is essential to start with strategy, and while organizations are competing, that there is a need for standards. The discussion also emphasized the importance of being mindful of trust, security and data protection as well as learning from initiatives around the globe in markets such as Asia that are leading innovation. Throughout the conference, there were other discussions about APIs such as SWIFT global payments innovation, which has APIs for banks to integrate the payment tracker into their channels. There are countless examples of APIs as products emerging from Open Banking and as propriety offerings across financial services.

    We see five key benefits of APIs as building blocks for the transformation of payments and financial services overall:

    • Productization. In the increasingly open financial services industry, an API is more than simply a means to access back-end services. It is a product in and of itself that providers can monetize and set as a foundation for other new services.
    • Collaboration. Some of the most popular (and profitable) uses of APIs result from third-party developers working together and creating apps that define new markets and create new revenue streams.
    • Enabling “API First”. For a digital business, it’s all about how you engage with API consumers—providing exactly the data they need, in the format they want to use.
    • Speed to Market. APIs can be provisioned quickly, often with minimal back-end refactoring required.
    • Security. The leading API Gateways have been vetted for security and are compliant in many areas (PCI, HIPAA, etc.) They also offer OAuth and LDAP support.

    As organizations seek to adopt digital business models, they need to ensure that everything and everyone can interact with what they have to offer. It’s no longer just about enabling mobile apps or even embracing the Internet of Things. It’s about having an API-driven ecosystem that can power your digital business and provide stakeholders the information they require in a faster world.

    Read more of our insights on open APIs in Driving the Future of Payments and The Brave New World of Open Banking


    Conrad Sheehan,
    Managing Director – Payments



    The post APIs: An enabler for transformation in financial services appeared first on Accenture Banking Blog.

    Accenture Banking Blog

  • user 10:53 pm on June 5, 2018 Permalink | Reply
    Tags: APIs, CitiConnect, , , , ,   

    CitiConnect APIs Support Real-Time E-Commerce Payments 

    ‘s new business models in e-commerce with 24×7 payment operations.
    Financial Technology

  • user 3:35 pm on June 2, 2018 Permalink | Reply
    Tags: APIs, , , , , , , ,   

    Will PSD2 APIs and instant payments change the game in European payments? 

    The EU’s Second Payment Services Directive ()—and the Banking Authority’s related Regulatory Technical Standards (RTS) on Strong Customer Authentication (SCA) and Secure Open Standards of Communication—represent a turning point for existing business models in in Europe. PSD2 and RTS open up ’ systems to third-party payments services providers (TPPs) for account information, payment initiation and confirmation of funds via an access interface such as application programming interfaces ().

    The final RTS published on 13 March 2018 specifies only the technical framework conditions and not interface standards. To help fill this gap, the Berlin Group—consisting of almost 40 banks, associations and PSPs from across the EU—has defined a common API framework called &;NextGenPSD2&; (current version 1.1) for the use cases specified in PSD2.

    The major impacts in this context include:

    Payment initiation opens up: For payment initiation, the NextGenPSD2 framework offers, amongst others, SEPA Payments (SCTInst) as a payment instrument. The combination of PSD2 and SCTInst has huge potential to disrupt existing business models, depending on the level of API standardization and penetration of SCTinst in the EU.

    Impacts on the cards business: TPPs such as merchants, giants and PSPs could use the PSD2 APIs to make instant payments directly from customer accounts to the TPP bank account, bypassing card schemes and fees.

    Frictionless instant payments with PSD2: Customer experience is key in payments. Friction and slowness can reduce acceptance of the payment instrument on both the customer and merchant sides, leading to higher cancellation rates in eCommerce checkout processes and longer queues in the store.

    But there are issues with SCA—PSD2 APIs require banks to perform SCA on every transaction. This could lead to friction in the user experience at the point of sale (POS) and in eCommerce. PSD2 provides a convenient way to solve the issue of SCA through inherence and biometrics-based SCA methods. As innovation in this area continues, there will be a huge push towards creating RTS-compliant biometrics authentication methods.

    How banks can innovate

    TPPs such as tech giants and fintechs are not the only ones that could profit from PSD2 and instant payments—banks could also play an important role. Access to accounts and instant payments become commodity services with low or almost no margin for banks. New revenue opportunities will be in the value-added services and the platform ecosystems around these commodity services. “Going beyond PSD2” will include opportunities to monetize additional data and services combined with instant payments.

    Read my complete article at InstaPay for more insights and share your views.

    The post Will PSD2 APIs and instant payments change the game in European payments? appeared first on Accenture Banking Blog.

    Accenture Banking Blog

  • user 12:18 am on June 2, 2018 Permalink | Reply
    Tags: APIs, , , Everything, , ,   

    How APIs Are Changing Everything for Wells Fargo 

    Application programming interfaces () open up a rich world of data exchange to , startups, and consumers. Large banks such as are operating with a growing number of APIs for third parties to connect with, and it’s the way customers interact with the bank. There is also a growing ecosystem of  [&;]
    Bank Innovation

  • user 3:35 am on May 23, 2018 Permalink | Reply
    Tags: APIs, , , , , , stateoftheart   

    How banks should act now to build state-of-the-art APIs for PSD2 and beyond 

    On 13th January 2018, the second Payment Services Directive () came into force, defining a new chapter in the European payments market. It requires to open their systems to third parties and provide interfaces to them to initiate payments on accounts, retrieve account information and a confirmation of availability of funds on accounts. Application programming interfaces () play a vital role and standardized APIs are required to avoid fragmentation in the European market, and promote the digital ecosystem. PSD2 does not come with an API standardization. To help fill this gap, the Berlin Group—consisting of almost 40 banks, associations and PSPs from across the EU—has defined a common API standard called &;NextGenPSD2”, which provides guidelines to reduces XS2A complexity. It is ready to be used by banks and TPPs for implementing PSD2-required bank account access.

    Berlin Group’s NextGenPSD2 is the leading API framework that helps banks to API standards. Since NextGenPSD2 does not specify one single API standard, banks follow basic principles of API design and build API standards that are state of the art:

    • RESTful JSON (full JSON format) for payments and account information by using standardized ISO20022 attribute naming conventions
    • Only a minimum set of data fields for the most relevant customer segments—such as retail, and small- and medium-sized enterprises (SMEs)
    • Single payment mode with all relevant payment products (such as SEPA Credit Transfer)
    • Embedded SCA approach (customer enters credentials at TPP side) and with full OAuth2-based SCA procedure

    Time is short. By 14th September 2019, banks are mandated to be RTS-compliant and even make APIs available for testing and piloting six months before the market launch. Having the optimal APIs in place that follow best practice principles will be crucial for banks’ “ PSD2” open banking strategy.

    Have a look at my complete blog and share your views.

    The post How banks should act now to build state-of-the-art APIs for PSD2 and beyond appeared first on Accenture Banking Blog.

    Accenture Banking Blog

  • user 12:18 pm on May 13, 2018 Permalink | Reply
    Tags: APIs, , , , , , ,   

    INV Fintech, Open Bank Project Collaborate to Offer Sandbox APIs 

    INV , the sister accelerator to Innovation, announced a partnership today with the Berlin-based Bank to provide and development services to the startup and its 13 partner companies. The sandbox will startups in the INV Fintech accelerator a secure digital space to access and incorporate bank data into their applications. [&;]
    Bank Innovation

  • user 12:19 pm on March 18, 2018 Permalink | Reply
    Tags: APIs, , , , , , , , ,   

    Through New Oracle Partnership, Baton Systems is Bringing the Cloud, APIs, DLT to Banks 

    EXCLUSIVE—The legacy infrastructure of most leaves something to be desired, and payments provider wants to use the , , and distributed ledger technology to help. The company, which just won the Bank Innovation 2018 DEMOvation challenge, has partnered with financial technologies provider , a move that will allow its technology to …Read More
    Bank Innovation

  • user 3:35 am on December 21, 2017 Permalink | Reply
    Tags: APIs, , , establish, , , , , , vital   

    Why PSD2 and Open Banking make it vital to establish industry standards for APIs 

    Major changes are underway in Europe’s payments landscape. In the UK, the Competition & Markets Authority (CMA) has triggered a fundamental reshaping of the UK’s digital financial ecosystem through the regulation. And in the EU, the (Revised Payment Services Directive) regulations—coming into force on 13 January 2018—require to open their systems to third parties, and provide interfaces for them to initiate payments and retrieve account information.

    However, PSD2 leaves open the details of the application programming interfaces () that third parties will use to connect with banks. While the CMA has required British banks to set up an independent implementation entity called Open Banking Limited, the European Banking Authority’s (EBA’s) draft Regulatory Technical (RTS) for PSD2 specifies only technical framework conditions and no interface standard.

    As a result, cross-bank or pan-European API standards have yet to be clarified. Creating these standards is : PSD2 aims to develop a unified, innovative, pan-European digital ecosystem for financial products—and uniform interfaces and processes are essential for achieving this goal. So the lack of an implementation entity for the EU is a significant gap.

    To help fill it, the Berlin Group—consisting of almost 40 banks, associations and Payment Service Providers (PSPs) from across the EU—has defined a common API standard called &;NextGenPSD2&; for the use cases specified in PSD2. Initiatives are also being launched in Poland, Slovenia and France. However, given that the standardisation initiatives of the Berlin Group and Open Banking are the most advanced, it makes sense to compare these two frameworks to identify their main differences. Here they are:

    USE CASES COVERED: Open Banking supports the use cases &8220;Payment Initiation&8221; (PSD2 article 66) and &8220;Account Information&8221; (PSD2 article 67). The Berlin Group covers all PSD2 use cases by adding &8220;Fund Confirmation&8221; (PSD2 Article 65).

    DATA FIELDS: Working with numerous EU banks, the Berlin Group analysed various online banking masks to create a minimum standard set of data fields which all banks must offer via their APIs. In contrast, the Open Banking standard was negotiated only among the CMA9 banks and a UK third-party advisory group, and provides more extensive information, including on balances and available balance types that are particularly relevant to fintechs.

    CONSENT MODEL: Open Banking allows the customer to allow specific data clusters for use by third parties – for example, only account balances, deposits or direct debit transactions. This approach is close to the data minimisation requirements in the EU General Data Protection Regulation (GDPR). The Berlin Group provides for consent only for account balances and transaction histories for a certain period.

    MESSAGE FORMATS: The Open Banking Standard uses only the JSON (JavaScript Object Notation) format with field names based on ISO 20022, while the Berlin Group offers alternative industry-standard formats. On top of JSON, Berlin Group supports JSON with encapsulated ISO 20022-based pain.00x for payments and camt.05x and MT94x for account information.

    AUTHENTICATION: Open Banking supports strong customer authentication (SCA) through the &8220;redirect&8221; approach, while the Berlin Group offers two more approaches: “decoupled” (using a dedicated bank app), and “embedded” (the name of the customer is carried directly through the bank API).

    USER EXPERIENCE: In addition to the API specifications, Open Banking standardises the user experience and text modules in the click route, unifying consent issuing, authentication (2FA) and account information/payment authorisation. The Berlin Group allows each bank to devise its own user experience.

    TRANSACTION RISK ANALYSIS: The Transaction Risk Analysis defined in the RTS is supplied differently, with Open Banking offering more parameters via the API.

    While these are the main differences at this time, the gap may narrow. For example, the Berlin Group is expected to incorporate requirements in the final version of its proposals, scheduled for publication by the end of 2017. It’s also important to remember that implementing a standard does not automatically make a bank PSD2-compliant, since it still needs to comply with other aspects of the RTS like authentication methods, exemptions from SCA and API testing systems.

    The EBA’s RTS is expected to be ratified by the European Parliament at the end of February 2018, after which banks and other PSPs will have 18 months to implement it—including providing APIs. In choosing between the available standards, banks should make their evaluation as early as possible and take strategic and technical aspects into account so they can hit the ground running. Time is short—and having the optimal APIs in place will be critical to success in the PSD2 world.

    For additional information, see our report, PSD2: Defining new customer journeys

    My thanks to Hakan Eroglu for his research and analysis for this blog.

    The post Why PSD2 and Open Banking make it vital to establish industry standards for APIs appeared first on Accenture Banking Blog.

    Accenture Banking Blog

  • user 12:18 pm on November 23, 2017 Permalink | Reply
    Tags: APIs, , , , , ,   

    What’s Next for SWIFT? APIs, Realtime Payments, and Cryptocurrency 

    EXCLUSIVE&;With global service gpi (global payments innovation) finishing up its first active year, how is SWIFT planning to push the service forward in 2018? The banking infrastructure provider will be moving gpi forward through new partnerships and new projects, most notably API capabilities, Stephen Grainger, managing director, head of North America for SWIFT, [&;]
    Bank Innovation

  • user 12:18 pm on October 28, 2017 Permalink | Reply
    Tags: , APIs, , , , , , , , ,   

    New Payment APIs, Tez Growth, Mobile Expansion Could Point to Bigger Fintech Ambitions for Google 

    EXCLUSIVE— Is looking to become a power? The company, which reported strong results for its third quarter yesterday, seems to be expanding its focus on finance, specifically on platforms that integrate or otherwise support payments and technologies in its many markets. For instance, while Google did not release numbers for its mobile [&;]
    Bank Innovation

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