With the world of finance moving into open banking, API has quickly become the poster child for innovation for the financial sector.
Beyond Europe’s well-known PSD2 initiative, Asian countries including but not limited to Singapore, Hong Kong and Malaysia are also making serious strides towards open banking.
2 Years in The Making– SFTI’s Initiative to Develop API Standards
In keeping with global trends, the Swiss Fintech Innovation Association (SFTI) has been very vocal in supporting this development. Walking the talk, the association commissioned working group to implement standardised APIs for the industry two years ago. (The api specifications can be found on their website here)
SFTI told Fintech News Switzerland that the aim of this was to stimulate the development of new, innovative products without compromising the security and self determination of both financial institutions and their customers.
The cross-industry unified interface specification is designed to be as compatible as possible with international standards and to enable the widest possible portfolio of financial services for the benefit of consumers and commercial customers.
Industry-Wide Support for Open Banking in Switzerland
The Swiss financial institution is largely serviced by several key players namely; Avaloq, Finnova, Hypothekarbank Lenzburg, Temenos and SIX. Combined, these players serves 3 quarters of all the banks in Switzerland.
According to the The Swiss Fintech Innovation Association, this is precisely why the felt it was crucial to have them as part of the working group.
In a statement issued to us, Avaloq, Finnova and Temenos all concurred that STFI’s role was integral to the success of this project.
In addition to that the believe that open banking presents one of the biggest opportunities for banks and fintechs to build an ecosystem of partnerships to deliver never before seen services and products to the end consumers.
Marianne Wild CEO of Hypotherkarbank Lenzburg who recently connected their APIs to enable virtual ATM withdrawals with Sonect said,
“It was immediately clear to us that the SFTI concept would give our bank, but also the Swiss financial centre as a whole, an enormous boost,”
Why Open Banking Matters in Switzerland?
“API banking” is more than just a “nice to have” for the Swiss financial centre. Customers will very soon demand the new opportunities associated with it from their banks and insurance companies in Switzerland as well.
The basis for open banking is interfaces (APIs), the more uniformly these APIs are designed among financial institutions and the more widespread they are, the sooner business models with innovative services can be built on them.
SIX has also been addressing the API issue. Among other things, solutions for payment transactions for banks and software houses in the corporate customer segment are currently being developed, and the focus is primarily on the implementation of banking use cases In this context its no conisdience that SIX is also a SFTI member from the very beginning. Both SIX and SFTI have therefore recently agreed to bundle their other activities.
In theory when open banking is implemented personal wealth data aggregation services could tap into the APIs of all participating banks seamlessly providing a single-view of their users finances.
The possibility are endless for open banking and SFTI’s initiatives will help the industry dig deeper on what they can achieve together.
