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Why US-Based Fintech Relies on APIs
- APIs have become a critical component of fintech, allowing systems with different data sources, methodologies and even technology platforms to work towards a unified goal.
- APIs provide an effective, scalable and modular solution to connect disparate financial systems.
- They not only provide connectivity openings between financial data sources but improve the performance and security of financial services.
- Fintech APIs provide a way to incorporate traditionally disparate technologies, opening up new opportunities for integration.
- Examples of effective fintech APIs include Plaid, Square, Stripe, Yodlee from Envestnet and neobank Chime.
- API sprawl can occur, as companies adopt new APIs, resulting in a complex and difficult-to-manage web of APIs and interconnected services.
- IAM solutions can mitigate the risks associated with API sprawl acceptance, providing advanced monitoring and compliance regulations.
- Fintech is heavily reliant on APIs, which continue to power innovation and evolution across the industry.
- API sprawl is not an insurmountable problem, and fintech providers can leverage IAM solutions to mitigate risks and resolve the issue of sprawl at scale.
- By resolving some of the technical complexities underpinning the fintech space, innovation and evolution of financial technology can move ahead full steam with an eye for detail and risk management.
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