With respect to API banking, India is witnessing a growing trend. A good API banking platform like that of InstantPay is powerful, secure and well documented.
To a layman, API banking might seem like a very unfamiliar term. However, once you understand its functionality, you might realise that you are using it already.
If you do a Google search on ‘API banking India’, you would come across terms like ‘API banking platform’ and ‘API banking services’. You would wonder what exactly API in the banking sector is? More importantly, how does API banking work?
Here’s all you need to know about API banking in India:
What is an API banking platform?
You might have used your phone to check maps, weather and more on your mobile phone. All these are examples of an application using an API behind the scenes. API stands for Application Program Interface. API banking services can increase the reach and inclusiveness of any banking service. The opening up of banking APIs to neobanks and other platforms is called open banking.
An API can connect apps like InstantPay with various service applications of banks. API banking enables ease of customer transactions.
If you are wondering, ‘how does API banking work?’. This can be better answered once we understand its features.
What are the features of a good API banking platform?
A robust API banking platform supports almost all banking transactions and not a small subset.
A security feature in an API banking platform cannot be stressed enough. This is because it oversees financial transactions. A good API banking platform should use secure internet protocols and encryption. It should also include several verification levels to maximise the security of requests between the API and end-users.
Elasticity refers to the ability of an API banking platform to quickly scale up its infrastructure resources to cater to a large number of users. Ideally, it should auto-scale from zero to millions of transactions, all in a short period, if required.
- Well Documented
A good API banking platform has to be well documented to reach through to the developer community. Documentation should be clear and should include code samples for easy reference. A Software Development Kit (SDK), which is a collection of software development tools in one package, is the icing on the cake to guide developers throughout the implementation.
- Sandbox mode
At a broad level, the transfer of ₹100 from the sender’s account to the receiver’s account requires the following:
Debiting the sender’s account
Crediting the receiver’s account.
However, at the development level, testing of banking services occurs from time-to-time. The sandbox mode enables testing of a banking product interface while there is no real money exchanged. The sandbox mode improves the efficiency of the API and reduces testing time. Thus, one is assured that the behavior of the API banking platform will be the same as the real live mode.
- Dedicated Support
Developers may be on strict ‘go-live’ schedules. They would need responsive, quick support via media, such as phone, chat and emails. A strong API banking platform should have a dedicated support system in place.
API banking in India is growing at the same rate as neo banking. The InstantPay API platform is a prime example of a sound neo banking platform with an equally good API banking platform.