Before we point at the magic word, Big Data – let’s talk a bit about the volume of data, financial services sector is also facing the challenge of managing the data in a secure manner. API’s are just one aspect of data transfer, but it is important to be integrated smartly. Thus APIs – application programming interfaces – have become an important part of doing business for companies in the current business scenario. APIs provide a secure environment for business and help them manage customers, employees, and business partners, while streamlining operations.
The banking sector is seen to use custom apps for better functioning of their corporate offices and customer care centers, along with facilitating secure transfers of funds. While, the insurance companies use a variety of applications for analyzing market data and helping customers manage their policies. Companies in the financial and insurance sectors are increasingly using apps to provide value added services such as mobile banking, ATMs, risk calculators, fund transfers etc.
- Increased competition: Given the scenario where competition in insurance and financial market has been increasing over time, online Fintech companies are also creeping into the sector, making competition fiercer. These companies – as they are present online with advanced transaction options – might be moving faster than the traditional financial companies. They are able to deliver their services faster and in the most efficient manner by using APIs. For instance, a Fintech company may use bank data on behalf of a customer to help them manage their finances in a better manner. By using external bank APIs, consumers would be able to use applications on their smartphones, allowing them to calculate the money spent on various products. It would also allow them to analyze their spending habit over a period of time giving them maximum mileage on the money invested. Traditional financial companies need to catch up with the growing competition to sustain in the market by using secure APIs.
- New opportunities: APIs would allow in expanding their existing platform for entering into a new market or adding new capabilities. Specialized solutions that are offered by APIs can help fill the gap, and institutions can rely on the APIs. Code versatility provided through APIs gives higher business agility by lowering the cost of operations, reducing the time for taking a product to the market and providing long-term revenue preposition for the firms. With this, data analytics – which has become a common feature – would help companies track behavior of the users, tracking regional transactions and other information. Organizations can recognize as well as respond to the needs of the customers based on the data and provide services by customizing their applications.
- Higher customer experience: Institutions are now looking at cloud in a big way. Transitions of services and products are being replicated on cloud and APIs have become even more important in arriving at business value as they are able to link customer data and backend solutions. As the mobile market is growing, it is imperative for institutions to provide streamlined services which might include combining products, location data, services, e-payments and others. Adapting to mobile technology might be a game changer for institutions and a vital business strategy for surviving in the market place in the long term and thus, using APIs has become a core preposition.
- Real-time access: Remote access for banking and shopping is now becoming a reality for customers. Institutions should be able to provide secure environment that is able to support services which includes capital markets, retail banking, insurance, wealth management and transactions over e-commerce website on varied devices. API driven solution would help organization in moving faster with regards to supporting new communication channels as well as devices. By using APIs, organizations would be able to demonstrate that the business is able to move their architecture for expanding and retaining their customer base.
With that, mobile interactions with clients are now setting new tempo to the entire business environment. As the response to any query is expected in seconds or within a day, this only gives a little time for banks to identify and react to situations. Thus, financial institutions and insurance companies need to be updated for supporting future technologies and APIs are considered to be at the core. Is your organization ready for getting connected in this interconnected world?
