For Seán Jevens, Head of Day-to-Day Banking Strategy and Propositions at AIB, API banking offers a means of developing new services quickly. “Where the backend systems are tightly coupled to the frontend, it can make sense to use new open banking APIs as part of the bridge towards a more modern service delivery framework,” Jevens explains. “The alternative is to lose potentially years in time-to-market while trying to revamp your entire architecture.”
AIB began working on their open banking API a number of years ago and are seeing the hard work paying off, as frontend and backend systems are now separated through service layers and service APIs. The result allows AIB to develop and deliver new digital services in timely, regular releases and light-years faster than before.
For now, open banking regulations don’t extend to data for loan or mortgage accounts, so banks and fintechs alike are still a ways from providing an all-in-one portal for people’s banking data. Still, API banking is playing a key part in AIB’s IT strategy.
“We will exploit API banking to provide new services and a broader ecosystem of financial services for our customers,” says Jevens. “But for all of our decisions in digital, we are guided by a fundamental principle: Don’t do it because you can do it, do it because you should do it.”
Jevens points out that AIB have provided multi-banking for enterprise clients since 1999, using SWIFT information to help customers get a holistic view of their banking through AIB’s online banking. “In some ways, business customers may have more to gain initially from these services,” he says. “Their requirements are more complex and pressing than those of consumers. For example, better banking integration for business clients could reduce the overhead in approving bank payments as part of a corporate workflow.
“A lot of what our customers want is more around financial education,” he continues. “By providing more analytics, we can help customers inform themselves and engage more with their finances. This is a real value add, compared to adding more technical features that may not be used or appreciated.”
When asked if that’s not what Revolut and other challengers are doing, Jevens returns to the fact that the startups do not provide the range and depth of banking services that people need day after day and year after year.
“They are actually filling a niche gap in the market for a digital wallet,” Jevens says. “People will use it to pay for taxies or split the bill. They give it to their children when they are travelling to ensure they won’t go short. All exposure is limited to the card balance, so it essentially saves you a trip to the ATM, but it is not ‘banking’. We see Revolut as a complimentary service our customers can use if they want.”