Will corporate bank APIs replace legacy connectivity?
Corporate APIs are catching up their consumer-focused equivalents, but many transaction banks are not convinced that they will usurp legacy connectivity options.
Advisory firm Celent recently referred to corporate-to-bank channel connectivity as a critical enabler for businesses as they expand. Application programming interface (API)-enabled connectivity supports multi-bank connectivity and data aggregation and enterprise resource planning (ERP), treasury management systems (TMS), and accounting software integration.
Corporate APIs have lagged consumer APIs in services such as real-time views of cash balances, with open banking being a catalyst for consumer use cases. But this is changing according to Kerstin Montiegel, head of client connectivity at Deutsche Bank, who says the cost-return ratio is now moving in favour of corporate adoption.
The pandemic, the war in Ukraine, inflation, and the disruption of global supply chains … have made multinational corporations realise the weaknesses of manual treasury processes
“Besides more mature bank API offerings, there are several other reasons why this is happening now, including the pandemic, the war in Ukraine, inflation, and the disruption of global supply chains,” she adds.
“These factors have made multinational corporations realise the weaknesses of manual treasury processes.”
Virginie Martin, product manager e-banking solutions at BNP Paribas Cash Management, accepts that consumer APIs are more advanced, but attributes the delay in the development of corporate APIs to a lack of standardization and the overall readiness in the market deterring corporates from using them either directly or via their ERP or TMS.