The Role of API Interface in Open Banking Model

Abstract

The paper discusses issues related to the role and future of API apps in the banking sector, especially highlighting the open banking model. At the beginning of the paper we describe the open banking idea, which brings in a number of changes in banks. The opening of the banking sector and collaboration with companies that offer API solutions may produce benefits to both sides, which will lead to more advanced payment solutions and services in the future. Next we present the role of API app in an open banking model. API interface acts as a bridge between the systems, banks may acquire value added by implementing these solutions in full. The last section of the paper draws attention to the fact that PSD2 directive aims to eliminate the monopoly of banks in the area of payments and create a level playing field for companies offering technological solutions. It is stressed that banks have started realising threats resulting from the untapped potential of the PSD2 directive and implementing regulations of the directive to be able to use a new source of revenue in the future. Attention has been drawn to that fact that following the implementation of PSD2 open banking model will become feasible.