The ongoing pandemic unleashed unprecedented disruption and is having a global economic impact. Indeed, during this global disorder, customer behaviours and financial services have been at the forefront of a transformation explained by the rapid transition to an online presence for individuals and businesses. These new trends and patterns, such as contactless and online shopping, have a tremendous impact on financial services.

In an online and cashless society, there has never been a more important time than now for banks to move their API strategy to the next level, in order to face the new challenges. API (Application Program Interface) banking is a mechanism that allows banks to digitise their services and enables FinTech's and banks to work together, by using this interface that acts as an intermediary between these two parties, all while respecting regulations.

The transition from traditional banking to API banking is revolutionising the entire ecosystem.

API enables innovation

The collaboration of banks with FinTech’s accelerates service digitalisation and fuels innovation. Indeed, by sharing financial data with third-party applications, banks are letting innovators develop in-house financial solutions and technologies relevant to their own customers’ needs. Developers’ capabilities significantly speed up the digital transformation of financial institutions.

API complies with regulations

In order to use the data provided by banks and maintain the security, companies and FinTech's hold FCA (Financial Conduct Authority) regulated authorisations, such as:

• AISP (Account Information Service Provider) for retrieving account data provided,
• PISP (Payment Initiation Service Provider) for initiating payments into or out of user’s account, or
• PSD2 (Payment Services Directive 2) that aims to align payment regulations with the market and technologies, by strengthening security requirements for initiating and processing electronic payments and protecting banks’ and consumers’ financial data.

API allows the monetisation of your interfaces

API monetisation is a way that businesses can use APIs to generate revenue, either directly or indirectly. It is possible for banks to be strategically charging fees to the customer for the use of certain API services. There are several pricing approaches that banks can take to monetize their API interfaces: pay-per-use, subscription, pay-per-transaction, etc... Banks only need to choose what model will benefit them the most according to their customers' needs and behaviours.

API allows you to address the ecosystem

Banks who are not using APIs to improve their digital banking experiences for customers risk falling behind the rush of competition in the market, as the digital transformation in the payment and banking industry is now more relevant than ever. By addressing FinTechs and being the backbone to launch their services, banks can now adopt the new positioning “Bank as a Service”.

HPS offers API services that allow banks to take advantage of this opportunity and proactively respond to the current situation by meeting the increasing demand for online and mobile solutions. Banks can digitise their services and keep control over their customers experience.  

Using APIs with PowerCARD, HPS’ comprehensive digital payment platform, is a great tool to manage and digitise the complete life cycle of a card and implement self-service:

• limit control,
• activation or deactivation of a card, e-commerce transactions, contactless payment,
• token management,
• e-merchant relationship, and other services.

Customer experience is also as important: PowerCARD users can define in real time their own customer experience to improve it and make it the most simple, effective and innovative. Indeed, to enhance customer experience, PowerCARD allows:

• real time customer boarding,
• real time card activation,
• remote configuration and installation and other services.

To know more about HPS and PowerCARD capabilities, please contact sales@hps-worldwide.com.