Bank API Integration 101

The ABCs of APIs in BaaS

Database API
Amanda Kilmer
Date Published
April 8, 2022
Read Time

First things first: What are APIs and why are they important?

Communication is key for effective collaboration, for healthy relationships, for successful teams — it’s no different with our technology. APIs, or Application Programming Interface, are the software engines behind the innovative integrations that let companies build within a set of definitions and protocols. An API allows two different programs to request data from one another; in fintech specifically, this allows for the completion of simple transactions with cards, the transfer of money via ACH, and the performance of KYC (Know Your Customer).

Brands and banks use an end-to-end software infrastructure platform, like Bond, to safely connect, drive revenue, and better serve their customers. Once unified, infrastructure platform companies create a future in which non-financial companies can make financial products available which increases revenue streams and expands SaaS verticals.

Merging APIs with financial services

Brands that work directly with banks to create financial solutions potentially face numerous obstacles and expenses. By utilizing a digital banking API, brands gain access to the right tools and expertise to help them avoid predictable errors, oversights, and delays. Combining financial services and technology, bank integration APIs merge powerful technology solutions with expertise and industry experience.

A brand is able to connect its products to a bank easier using API technology that has been specifically developed for that purpose with an embedded finance platform. Working directly with a bank to develop a financial product can sometimes be a slow and inefficient process, but connecting to a bank with API tools allows for a much faster and easier integration.

Digital banking API code is able to change the trajectory of a company and there are multiple suppliers of banking API tools, such as open banking API GitHub or RapidAPI — two API powerhouses. With multiple uses and benefits of using APIs in banking, Bond is able to change the game by allowing users to choose the best banking partner that will increase their profits and maintain flexibility with a customizable, multi-bank approach.

Bank API integration

With access to modern infrastructure based on APIs, brands and banks can now connect with each other at scale, ushering in a future in which non-financial companies can provide financial products to their customers. By providing bank API integrations, brands create options for financial services like offering virtual cards for a secure digital wallet, a credit builder card for specific communities, or providing rewards for customer loyalty.

Using an all-in-one BaaS provider for API integration supplies developers with tools needed to offer unique financial products with no more than a few lines of code; they’re able to create accounts, move money, or issue debit and credit cards, amongst others. Blending expertise and technology with API integration solutions, API banking becomes a full suite of financial products that contains award-winning technology and bank-grade security. 

API integrations benefit brands and banks by providing a method of financial connection that is safe, secure, and efficient. Additionally, APIs provide affordable integration solutions so API pricing varies depending on the type of API you want to use.

Examples of banking APIs

There are multiple benefits of API in banking for both brands and banks alike — bank API meaning the APIs that you can use for performing banking actions, like creating an account or moving money, making users of payment services no longer solely dependent on the direct services offered by their own bank. Some of the benefits of using open banking APIs include the ability to build and test products in a simulated sandbox environment and access industry expertise that can help avoid obstacles and maintain compliance.

Numerous banking API examples illustrate the benefits of using a banking API including:

  • Consumer charge cards: Companies use banking API technology to build personalized charge cards for their customers without the difficulty of program management and underwriting.
  • Consumer banking and debit cards: Banking APIs allow users to custom design their own banking and debit cards, including features of a standard bank account such as bill payment or money transfers.
  • Secured charge cards: Brands can use baking API capabilities to create and launch charge cards that will help their customers build credit. Using a software infrastructure platform, brands can build without needing to worry about compliance, program management, or underwriting.

Developer tested, developer approved

Combining different features and capabilities that users need into a single, intuitive platform without any third-party integrations or additional contracts helps users reduce the amount of time they spend evaluating infrastructure vendors and sponsor banks, navigating complex API documentation, and fighting with unintuitive APIs.

Providing a full-featured developer sandbox, Bond is a premier option and the go-to API in digital banking. Bond’s sandbox allows developers to design, build, and test their product within a virtual environment with multiple scenarios and various kinds of alternative transactions. Rather than having to integrate directly with a bank, brands use Bond’s digital banking API code within the sandbox environment and then simply change API keys to deploy from sandbox to production with a few clicks.

Benefits of bank API integrations

One of the biggest benefits of APIs in banking is time. Normally, it would take anywhere between 18 to 24 months to design a basic infrastructure, perform testing, and launch a finished product. With bank integration APIs, a brand can do this in weeks. Additionally, by streamlining the administrative side of launching a new financial product, developers can focus on building their UI and delivering the WOW factor to their customers.

Open banking API

Open banking APIs are used by financial institutions to exchange financial data with one another. Open banking API pricing is usually done by the transaction or API call.

Having a developer dashboard that makes it easier to manage an integration with a BaaS provider is essential. This dashboard allows the developer to generate API keys and test apps within the sandbox. Users can also configure webhooks to be used for every endpoint while accessing and viewing historical webhook event logs to monitor how their apps are performing. Providing visibility into logs of API status, requests, and responses makes it easier for developers to debug their product.

Open banking API integration

Using an open banking API integration from an open banking developer prevents brands from spending more time than necessary locating and considering various sponsor banks and infrastructure suppliers. Brands and banks avoid having to navigate complicated contracts and disorganized documentation, not to mention the frustration of dealing with an API that’s stubborn or poorly constructed. Open banking API documentation is much simpler with a software infrastructure platform with open banking API providers like Bond.

Open banking API Python compatibility may be offered by open banking API solutions. Banks and brands can meet their open banking API specification by using high-quality banking API integration tools like those Bond offers, including Python. Users are able to design solutions with ease by utilizing powerful APIs to offer unique financial products to their customers and data is unified to provide a reliable source of truth that encompasses all products and customers.

Open banking API examples

To understand the true power of open banking API providers, let’s look into Squire. Squire is a Point-of-Sale system that enables barbershops to manage bookings, schedule appointments, and oversee pricing and payments all within a single app. They were able to expand and create the Squire Card for barbers by using Bond’s existing API integration. 

Another use case for open banking API is Qoins. The Qoins Card helps people pay off their debt with each swipe of their card. By creating sub-accounts with Bond’s digital banking API code, Qoins’ customers can save for multiple goals like a rainy day fund or paying down student debt.

API banking vs Open banking

The main difference between API banking and open banking is how the APIs are used; API banking is accessing the banking functionality while open banking API is focused on user data. Open banking is heavily involved in regulation and is the basis for making Banking as a Service (BaaS) possible, which uses API banking. 

Additionally, banks with API access are integrated into financial services and produce innovative outcomes that boost the company’s community of users. An open banking API list increases the growth of fintech by improving financial transparency. Once API example banks are on board the platform, companies now only have one point of contact to maintain and risk for them is fairly low.

Bank API integration at Bond

Bond is a comprehensive BaaS platform that maximizes all of the benefits of bank API integration. By providing tools for onboarding, performance dashboards, and methods of monitoring transactions, Bond connects brands and banks securely and at scale with both open banking APIs and banking APIs.

Just one way Bond is using bank API integrations is issuing cards — both debit and credit — and the benefits of API-based banking are many. Speed to market, brand differentiation, reduced cost to launch, access to customer behavioral data amongst others are just a few of the ways Bond is using bank APIs while changing, creating, and innovating multiple ways to make banking accessible to all.

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