API and UI Intersection Accelerates Digital Banking

A recent analyst report showed that only 23% of all financial institutions believe their cash flow management needs are being met. And you don’t need to be a CFO to see that’s quite a substantial gap. How do you close it? It won’t surprise you that digital banking will be a big part of the answer, but there are two elements of digital banking that seldom appear in the same sentence: APIs and user interfaces.

They certainly don’t represent the only strategies for closing the cash management credibility gap—the ability to manage multi-bank relationships plays a huge role, as does payment monetization. But this intersection of APIs and user interfaces (UI) is an essential one to explore and master as digital banking for commercial customers continues to gain critical mass. Ultimately, delivering the best experience for financial institutions comes down to delivering frictionless experiences. That’s why having one look and feel across multiple applications is essential.

Amplifying the User Experience

From a user experience perspective, it gets back to flexibility and customization. For example, some corporates today want to go into the web application. Others want to stay within their ERP and have their banking information served to them. The ERP in this example is their user experience, while others want to have that experience via an API integration. And it’s here that UI maps back to the individual and unique user experience.

That map travels through the important yet underrated synergy between APIs and the user experience (UX). The functionality, reliability, and responsiveness of an API directly impact the UX of the apps or platforms that rely on it. For instance, if a payment initiation API is slow, it will result in a sluggish user experience. If it’s unreliable, it can lead to user frustration. On the other hand, a well-designed API can be a catalyst for innovation. APIs can ensure a consistent UX across different platforms, whether customers access their account through a mobile app, a third-party platform, or a desktop site.

Why should a banking or payments executive invest in UI? Effective design is no longer a nice to have; it’s a must-have. Enterprise applications have trailed behind the consumer user experiences we’ve become accustomed to. This lag has largely been because of how they were built in the first place, unable to adapt and emulate the connected experiences we enjoy on our everyday devices, where apps are interoperable and share information with absolute ease. It’s been difficult to achieve the type of fluid user experience, which commercial customers are now demanding. According to a recent KPMG commercial banking report, “While cash management and financing will remain key sources of income, commercial banks should constantly innovate to keep up with the fast pace of change. Most (88% of leading commercial banks surveyed) plan to invest in innovative products and services to boost customer-centricity. Areas for development include API-enabled products, capital allocation optimization, digital lending solutions and serving new segments.”

More Intuitive Experiences

This brings me back to the cash management credibility gap. FIs need simple and intuitive user experiences to address this gap. Imagine the complexity of the multiple banking relationships most companies have with the resulting need for a clear view of their cash positions across these relationships. APIs coupled with an intuitive UI enable FIs to extend their offerings to address evolving customer cashflow management needs, such as payment hubs, ERP and accounting integrations, and better cash forecasting. APIs + UI = new value propositions for banks to offer their customers.

Furthermore, deep UI-level integration enables a unified look and feel across the bank’s entire platform. A best-in-class UI enables flexible deployment where the platform can act as the customer portal; it can be deployed as a white-labeled solution under the bank’s portal, or it can be deep-linked from within the portal. Regardless of how it’s deployed, the API is the basis for building the user interface.

As commercial banking becomes more interconnected, APIs play a more crucial role. A seamless UX in this interconnected ecosystem is only possible with well-designed APIs. As new technologies and trends emerge, banks need to be agile in adapting their user experiences. APIs allow for quicker integrations, enabling banks to be more responsive to changes in the market or technological landscape. Take the trend toward hyper-personalization, for example. Personalization is poised to go real-time, using AI to adapt to user behavior, resulting in an enhanced user experience and more relevant interactions. APIs will need dynamic UIs to make this happen.

To sum up, while APIs operate mostly in the background and are often not visible to the end-user, they play a foundational role in shaping the user’s overall experience. A commercial bank’s investment in both innovative API infrastructure and intuitive UX design is essential for success in today’s digital banking landscape.