Achieve your Banking-as-a-Service goals with a tailored API management platform  

Welcome to the third installment of our Banking-as-a-Service series, where we’ll cover how you can get started with BaaS and open banking, and how to select the right API management platform that enables you to be successful on this journey.

Anna Birdsall Anna Birdsall

In our previous two articles, we talked about the need for Banking as a Service (BaaS) and why this is revolutionizing the banking industry, the 5 API-led strategies that banks can take to utilize APIs, and why BaaS has become the most important enabler for growing your digital business. 

Banking-as-a-service and open banking offer a new business model—opening up new channels to distribute banking products—that can drive new revenue. It’s a way for banks to take advantage of (and reap a return for) the products they already provide—such as credit services, accounts, and loans—by making them available to other businesses digitally. It diversifies your product portfolio and reduces your customer acquisition cost (CAC). From a business point to view, it just makes sense. So it’s no wonder banks are eager to get started. (And if they don’t, their competitors will.) However, there are some very real technical challenges and security risks that may stand in the way. 

You may be dealing with inflexible legacy or home-grown systems that make creating new APIs hard, or perhaps you don’t have enough of the right IT expertise and tools to securely manage your current APIs. 

Because APIs are everywhere, API security is now a top priority for almost every organization. A few years ago, Gartner predicted that by 2022 API abuses will move from infrequent to the most-frequent attack vector—making the need for security policies enforced by API gateways and other tools a necessity. 

Most API platforms provide an API gateway, an API management tool for securely managing and protecting APIs with authentication, authorization, access control, rate limiting, and threat protection.  But just having a basic API gateway isn’t going to deliver what you need to fully manage your APIs. You need one that provides monitoring and easy-to-segment analytics so you can assess how to change or improve your API strategy. It should also offer a broad range of security options, including the ability to integrate with third-party providers, and it should have a drag & drop UI that allows you to make changes easily and rapidly to reduce the chance of error. 

Since APIs are the essential keys to implementing BaaS, it’s critical that the APIs themselves are managed as products. That means it’s not only important what functionality they deliver, but also how they deliver it. This is where the right API portal plays a vital role. For BaaS APIs, the customer experience—or since the customers are developers, the developer experience—is important. An API portal is where you package and promote your APIs. It should drive API adoption with sandboxes, mocking, samples, and related assets, while also providing a community for feedback. A great API portal can then help promote your new BaaS APIs through a customizable API Marketplace to attract new clients and retain existing ones. 

Together, an API gateway and an API portal are two vital components of an API management platform. They can simplify the management of your APIs by providing a single place to manage APIs as products, and enable governance, monitoring, security and support. All in, you can manage the full API lifecycle. API management can be complicated, but it’s a lot simpler when you are using a best-in-class API management platform, such as API. API is a top-ranked API management platform that helps you expertly manage your APIs like products throughout their lifecycle. webMethods gives you everything you need to turn your existing banking products into BaaS solutions practically overnight. API can handle the really tough API challenges and bring your API-first BaaS strategy to life. With this best-in-class API management platform, you’ll be able to: 

  • Create a digital channel to make existing offerings available through other businesses, so you can expand your customer base at a lower cost 
  • Promote and publish BaaS APIs to prospective clients 
  • See who is accessing BaaS APIs and what they’re doing in order to provide the best service 
  • Leave your legacy systems in place while creating advanced solutions for BaaS 
  • Protect customer and financial data as well as back-end systems from overload with a solution that is easy to implement and enhance over time API, a leader in multiple independent analyst assessments, comes with built-in services to ensure your investment pays off. The technology is based on open standards and compatibility. You can leave your existing systems in place while focusing on innovation. But it’s the key components of the API platform that really elevates it above other API management platforms. 

The webMethods API Gateway, the foundation for protecting your data and systems, has a graphical UI to make it easier to use and offers a wide set of policies for threat protection, access control, mediation and throttling to protect financial and user data. It’s integrated with 3rd party API security tools like Salt, Noname and Cequence, for better security in the cloud, and advanced analytics allow API providers to monetize their products. 

The webMethods Developer Portal supports full lifecycle API management. While traditional API portals are inflexible in their functionality and difficult to customize, the webMethods Developer Portal enables banks to easily create a customized API marketplace that acts as a hub for APIs wherever they are deployed, including third-party gateways. Related assets such as microservices, B2B connections, and connectors needed by the API can be hosted in the marketplace as well to ease adoption. And it’s easy to promote collaboration with secure communities. 

Without an API platform, developers would be forced to manually perform the maintenance of all their APIs, ensuring each one is being monitored for progress, performance and security. But by using a highly capable API platform, developers are empowered with the tools they need, boosting efficiency. Developers can work with confidence knowing that APIs are being managed securely and effectively. API has a cloud pricing model that is simple and clear. Other vendors often cap API calls, but webMethods accurately tracks your usage and bills you appropriately so you only pay for what you use, and you’ll never have to worry about being blocked.  

To sum up, banks looking to take on a Banking-as-a-Service initiative need a tailored API management platform that reduces risk, facilitates adoption, and can be executed rapidly. API is an enterprise-proven solution for managing APIs in complex environments. With API, you’ll be able to securely and quickly deliver your new digital products. 

Interested in giving API a try?