16 October 2018

Delivering a global platform for the financial services API economy

New SWIFT white paper explores how the global financial services industry can unlock the potential of API technology

Application Programming Interfaces (APIs) are reshaping the way business is done today, allowing companies to tap into information that was previously locked up in other companies’ software systems to add value for their customers.

The financial services industry has been slow to adopt APIs, but is now catching up. New regulatory developments such as PSD2 in Europe, and a move towards open banking globally, have created significant opportunities for innovation in this space.

For nearly five decades, SWIFT has worked closely with the industry to create and maintain the platforms necessary to process financial transactions efficiently and securely. Now, as the industry moves towards increased use of APIs, there is a need to bring consistency to the way these technologies are deployed to avoid fragmentation, isolation, and the needless complexities that will frustrate attempts to build the value-added services customers want.

API

Overcoming the obstacles

There are several key obstacles that we believe the industry must overcome to reap the benefits of API-based solutions.

The greatest is fragmentation. Flexibility is a chief strength of API technologies, but as developers pursue bespoke solutions for specific business problems, this very flexibility can lead to inconsistencies in API business specifications, and in the security and identity frameworks needed to access APIs in a trusted way. Regulatory specifications also differ around the world and individual financial institutions often have significant leeway in interpreting them. This fragmentation requires companies to develop different solutions for every market in which they operate: a clear cause of inefficiency and an impediment to global adoption at scale.

For large organisations with significant legacy, it can be particularly challenging to implement API-based solutions without major risk and disruption. For incumbent market leaders therefore, the challenge is to unlock transformative change in an environment that prioritises stability over agility.

SWIFT: Building the API marketplace for financial services

Standards help to manage risk and bring more control, especially at times of rapid change. SWIFT’s position as industry standards setter allows us to provide a neutral forum for collaboration towards consistent API standards. We are delivering an industry tooling platform for the development, maintenance, publication and testing of common API specifications. This platform builds on ISO 20022 and MyStandards to ensure end-to-end consistency in business processes that encompass both API and more traditional architectures.

By exposing standardised access to API-based systems via SWIFT’s highly secure, private, and trusted communications infrastructure, we are creating a marketplace for API-based services that is built on our proven, industry-strength, digital security and identity solutions.

The range of SWIFT services that financial institutions, market infrastructures, and global corporates can access via SWIFT’s API marketplace is growing rapidly. Vital shared services such as our financial crime compliance services, reference data, SWIFT global payments innovation (gpi), business intelligence and more are already available and are being supplemented by services provided by unimpeachably qualified service providers.

Read the white paper to find out more

Find out how we are supporting the development of an efficient API economy for financial services, and what this means for you.

Download our white paper:

Delivering a global platform for the financial services API economy

PDF iconDownload (132.16 KB)
Last update: 
16 October 2018

White paper

  • Standards
English
 

 

Standards

Delivering a global platform for the financial services API economy

White paper

PDF icon Download (132.16 KB)
English

Extended reading

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Business Standards and Emerging Technologies

For decades, financial industry automation has been based on the exchange of structured financial messages, but this picture is changing rapidly. New automation approaches such as Distributed Ledger Technology (DLT) have emerged to challenge messaging’s dominance, while maturing technology, including Application Programming Interfaces (APIs), is being widely deployed in the financial services industry, driven by regulation and competitive forces. In the near future we can look forward to business processes that span multiple automation mechanisms.

Download (317.77 KB)
English
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