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Realtimecampaign.com Discusses Frequently Asked Questions about Open Banking API Use in the United States

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Realtimecampaign.com Discusses Frequently Asked Questions about Open Banking API Use in the United States

November 19
08:39 2021
Realtimecampaign.com Discusses Frequently Asked Questions about Open Banking API Use in the United States

Application programming interfaces (APIs) have been around for two decades, but it’s only within the last few years that they have become popular within the financial services sector. Open banking APIs are designed to make it easier for approved third-party companies to access banks’ financial data in order to provide services to their customers, such as validating payments. The adoption of banking APIs has dramatically simplified the process of building apps and services within the fintech industry, but many people still aren’t 100% clear on what they are and how they work. Read on to find answers to some of the most frequently asked questions about open banking APIs to get some clarity.

What Are Open APIs?

Open APIs support open banking and make it easier to meet the industry’s strict regulations. Banks can use APIs to extend and enhance their B2B and B2C services by leveraging third-party applications that would otherwise be too complex to implement. These vital software tools are expected to usher in a new era of online banking.

Who Will Benefit From Open Banking API Adoption?

It should be obvious that banks will benefit substantially from adopting open API protocols, but according to realtimecampaign.com, customers have even more to gain. Financial service providers and lenders can use APIs to safely and securely obtain customer data faster than ever, making it easier for them to determine eligibility for loans. In some countries, open APIs even allow third-party lenders to provide services to popular financing methods to traditionally underserved segments of the population who do not have credit histories.

How Popular Are Open Banking APIs?

In some countries, open banking is already incredibly popular. The hyperactive open banking market of Latin America is just one example. In the United States, banks face some extra hurdles when it comes to adopting this essential new technology. 

The unruly mix of legacy banking systems and emerging technologies coupled with a lack of strong federal regulation has made some financial service providers hesitant to take advantage of API providers like FinLync. However, all that could be changing soon. President Biden has expressed a commitment to making it easier for bank users to transfer their account data across institutions, and around 60% of banks are already implementing API tech. As user interest grows and regulations get put into place, the United States should catch up to the rest of the world.

Are Open Banking APIs Secure?

There are two aspects to open banking API security. Consumer data must be protected both while it is at rest in storage and while it is being transferred between banks and financial service providers. Anyone interested in adopting open banking API technology in the United States should check that the provider is invested in creating and maintaining a robust security system. Unlike Europe and many other areas of the world, the US has yet to implement strict regulations regarding open banking security standards.

Open Banking Is the Future

Open banking is the future. Embrace it now to get a competitive edge and stay ahead of the game. Everyone has something to gain.

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Company Name: Realtimecampaign.com
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Website: Realtimecampaign.com