Celent: The API is Mobile Payments’ Ultimate Weapon

May 9, 2018         By: Steven Anderson

There are a wide range of tools out there for mobile payments, from mobile wallet apps to Europay / Mastercard / Visa (EMV) capable cards to contactless payment systems and beyond. According to a new report from Celent, though, we may have a new winner in terms of that one tool that goes farther than any other: the application programming interface (API).

Celent sent a report our way titled “APIs in Banking: Unlocking Business Value With Banking as a Platform (BAAP).” The report examined the history of the API, and how it started out as a way to get applications to talk to each other way back in the 1990s. Fast forward almost 30 years and APIs now have a role in mobile banking, in cryptocurrency, and an array of other technologies as well.

One of the biggest examples of companies putting APIs to work was eBay, which brought out its own API in November 2000 in response to the array of apps that were working with eBay, either officially or unofficially. eBay’s API made it easier for partners to work with the company, and once others got wind of how easy it was to bring diverse applications providers under one umbrella, others got involved. Now, eBay generates 60 percent of its revenue from APIs, and Expedia.com generates 90 percent therein.

Banks got involved as well, and used APIs’ power to establish and benefit from a range of partnerships. Fidor Bank, for example, brought in payment card operators like Mastercard, investment groups like Nutmeg, and even cryptocurrency / blockchain firms like Ripple.

The Celent report makes it clear how many points APIs are found in, and the kind of impact they can have on a wide range of fields. Whether it’s connecting various parts of a larger whole together–as seen with eBay and Fidor Bank–or opening up new opportunities for smaller business to become components of larger firms, the end result is the same. More opportunity, more features, and more value for customers.

It’s all brought about thanks to APIs, the software tool that has value all throughout the mobile payments ecosystem. Without APIs, who knows where we’d be today?