If I said to you that Banking APIs aren’t about tech or banking, what would you say?
Come on, admit it, your first reaction would be to think: “well, of course they’re about banking – the clue is in the title.”
Category errors aside, the argument put forward by Jason Bates, co-founder of Monzo, deserves careful reading and reflection.
He makes two pressing points, both of which need to be taken on board by banks.
First, there is a danger that banks treat APIs as a solution in search of a customer problem.
Instead, they need to recognise that APIs are only a means to an end – a seamless user experience – not an end themselves.
Second, banks mustn’t limit themselves to just banking journeys when solving complex customer problems.
Rather, they should use the opportunities afforded by APIs to embed traditional banking features in other customer journeys, outside of online banking applications.
Jason knows what he’s talking about. Listen to him.
However, I want to go a bit further and sling a shot across the bows of the banks.
Don’t be lulled into a false sense of security by Jason’s words.
Solving real customer problems using APIs is very, very hard.
Not many do it well.
Companies with strong APIs, like Twilio, Stripe, Etsy and Dropbox are very different breeds to banks.
They have a culture of empowering engineers to solve problems.
Small, two-pizza teams of smart creatives, continuously deliver value by releasing code into production every week, or even every day.
And other businesses build applications on top of their platforms.
Let’s not kid ourselves here.
This stuff is difficult, even for companies with a history of moving fast and innovating.
To exploit banking APIs, banks must act like…er, how do I put this…something other than banks.